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Stocks in New York managed to close in slightly positive territory Friday despite news of a stalled relief plan for U.S. automakers.
Dow Jones Industrial Average, down as much as 217 points early on, ended up 64.59 points, or 0.8%, at 8629.68. The
S&P 500 edged up 6.15 points, or 0.7%, at 879.74, and the
Nasdaq gained 32.84 points, or 2.2%, to 1540.72.
For the week, the Dow lost 0.1%, the S&P added 0.4%, and the Nasdaq added 2%.
A federal rescue plan for Detroit's
Big Three automakers failed to pass the Senate late Thursday after the United Auto Workers union refused Republicans' demand for aggressive wage reductions. The House had already approved the plan to provide aid to
Ford(F - Get Report),
General Motors(GM - Get Report) and
The Senate voted 52-35 against the bailout in a procedural vote. It needed 60 votes to pass. According to Washington officials, the bill might not resurface until the new year.
Chrysler and GM, though, have said they may have only weeks of sustainability remaining. Even before the vote failed,
GM hired advisers to help it decide whether to file for bankruptcy, according to a report in
The Wall Street Journal.
"It would have been a stop-gap measure for a few months, not a bailout," says Michael Strauss, chief economist and market strategist, Commonfund. "But Washington officials are politicians, and unfortunately they focused on a political agenda, not a solution to the problem."
In response to the bill's failure, the White House said it might now be willing to use money drawn from the $700 billion Wall Street bailout, known as the
Troubled Asset Relief Program (TARP). The
Treasury also said it's prepared to pitch in.