US Stocks Extend Gains To 4th Day; Banks Falter

TIM PARADIS

NEW YORK (AP) — Stocks tacked on modest gains Tuesday to extend a rally to a fourth day following a strong rise in pending home sales, the latest encouraging signal for the troubled housing market.

The Dow Jones industrial average briefly pushed into the black for 2009 but ended 35.5 points below the break-even mark. In March, the blue chips were down 25.4 percent for the year.

A slump in financial shares kept overall buying in check as several big banks said they would sell more stock to repay federal bailout money. The modest moves followed huge gains on Monday, when indicators jumped more than 2 percent on positive signs for manufacturing and other good economic signals.

The main driver of stock gains was a report showing the biggest jump in nearly eight years in pending home sales for April, however some market watchers worried that the sudden gains since last week may be overdone.

"The fear is that we're unable to tell whether we have green shoots sprouting or weeds popping up through cracks in the concrete," said Lawrence Creatura, portfolio manager at Federated Investors in Rochester, New York. He was referring to early positive signs in the economy that Federal Reserve Chairman Ben Bernanke has called "green shoots."