Wall Street Continues Wild Swings

Rotblut of Zacks didn't fully agree, saying Paulson deserves some praise for being creative in the face of a crisis. "Considering there's going to be a transition in the administration I do think he's trying to allow for some flexibility," he said. "Despite all the criticism, I think it's important that we have some action. In a crisis situation, action's always better than non-action."

Rotblut said that any solution to turmoil in the financial markets would be an educated guess at best, and declines in Libor rates and improvement in the Treasury-Eurodollar spread indicate that lending markets have been calmed somewhat by recent government initiatives.

The automakers, also lately on the ropes, were once again on investors' radar, as Mazda Motor said Ford (F Quote) was reducing its stake in the Japanese company to 13% from 33%. Ford, along with General Motors (GM Quote) and Chrysler, are facing mounting cash-flow problems on declining vehicle sales, credit crunch -related financing troubles and substantial legacy costs.

Looking at the day's earnings, hardware store operator Home Depot (HD Quote) announced earnings that fell 31% year over year on declining revenue, but the results were enough to edge past analysts' estimates.

Fashion retailer Saks (SKS Quote) swung to a third-quarter loss.

In merger news, Alpha Natural (ANR Quote) and Cliffs Natural Resources (CLF Quote) announced they had agreed to drop previous plans for a merger valued at about $10 billion.

Shifting to economic data, the Bureau of Labor Statistics reported that producer prices fell by a record 2.8% in October. Economists were expecting a decline of 1.8%. The core rate PPI increased by 0.4%, above expectations for a 0.1% uptick.