Dow Finishes Up 226 as Home Sales Surge

NEW YORK (TheStreet) -- The Dow rallied to a sharp, triple-digit gain and stocks finished near their highs of Wednesday session, reversing a recent trend that's found the pace of stock losses picking up near the closing bell, after a stronger-than-expected read on April pending-home sales lifted market sentiment for much of the day.

The Dow Jones Industrial Average rebounded from Tuesday's 113-point slump to finish higher by 226 points today, or 2.3%, to 10,250. The S&P 500 gained 28 points, or 2.6%, to 1098 and the Nasdaq went ahead by 59 points, or 2.6%, at 2281.

Phil Orlando, chief equity market strategist at Federated Investors, attributed the session's gains to the favorable combination of a snap-back from Tuesday's late selloff plus a strong data point with pending home sales since both April's and March's upwardly-revised gains were stronger than expected. Additionally, Orlando said, the market's focus is already shifting to the May jobs number.

"Because of the short week, the ADP [Automatic Data Processing] number was moved to tomorrow -- normally we would have gotten that today -- so you've got a ton of important jobs data that's going to be coming out in the next 24 hours."

"There is the potential for a huge headline number on Friday," Orlando said, citing expectations for strong job growth from temporary Census hiring.

Economists project that the private sector added 56,000 jobs in May, while May nonfarm payrolls are expected to show growth of 500,000, according to Briefing.com.

The chief executive of Moody's(MCO) and Warren Buffet, the rating agency's largest shareholder, are testifying before the Financial Crisis Inquiry Commission on the role ratings agencies played in the financial crisis. Shares of Moody's were trading up by 2.8% at $19.84.

Germany's Cabinet approved legislation that would expand a ban on naked short-selling of stocks and eurozone government debt, according to the Associated Press.

In Japan, Prime Minister Yukio Hatoyama resigned Wednesday to improve his party's chances in an election next month. Hatoyama's popularity suffered over a broken campaign promise to move a U.S. Marine base.

Overseas on Wednesday, Hong Kong's Hang Seng dipped 0.1%, and Japan's Nikkei fell 1.1%. The FTSE in London declined by 0.2%, while the DAX in Frankfurt finished flat.