Dow Goes Positive as JPMorgan Climbs
09/26/08 - 03:38 PM EDT
TSC Staff
Updated from 1 p.m. EDT
Stocks on Wall Street turned mixed Friday as traders continued to weigh the possibility of a financial-sector bailout and the implications of JPMorgan Chase's (JPM Quote - Cramer on JPM - Stock Picks) acquisition of Washington Mutual (WM Quote - Cramer on WM - Stock Picks). The Dow Jones Industrial Average, down more than 100 points at the outset, went positive and was lately higher by 76 points at 11,098. The S&P 500 was losing 2 points at 1208, and the Nasdaq was the weakest performer, falling 13 points to 2174. Somewhat encouraging for the market were comments from President Bush, who said that elected officials would find common ground and arrange a rescue for the financial system. "We will rise to the occasion, where Republicans and Democrats will come together and pass a substantial rescue plan," he said. On Thursday, the three major indices rallied sharply on the expectation that Congress would quickly pass Treasury Secretary Henry Paulson's $700 billion bailout plan to purchase troubled assets from the financials. After the session ended, however, discussions on Capitol Hill about the bailout hit a rough patch. The Wall Street Journal reported that an alternative proposal by Republicans tabled efforts to pass the Paulson plan. The news of the potential breakdown coincided with word that federal regulators had seized Washington Mutual and arranged the sale of the assets, deposits and some liabilities of the failed bank to JPMorgan Chase. The Office of Thrift Supervision and the Federal Deposit Insurance Corporation facilitated the deal. Shares of JPMorgan, up more than 7%, were leading the Dow, while WaMu was trading down 90% at 16 cents.
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