Dow Finishes Up Despite Slowdown Signs

NEW YORK (TheStreet) -- Stocks finished higher Wednesday, holding gains made on abating eurozone debt concerns, even after both the Federal Reserve's latest beige book report and afternoon comments from President Obama emphasized a slowdown in the economic recovery.

The Dow Jones Industrial Average gained 46 points, or 0.5%, to close at 10,387. The S&P 500 added 7 points, or 0.6%, to 1099 and the Nasdaq finished 20 points, or 0.9% higher at 2229.

Earlier European markets finished higher with the FTSE in London ending 0.4% higher and the DAX in Frankfurt gaining 0.8% after the Portuguese government successfully sold three-year and 10-year debt worth $1.3 billion. The auctions saw strong demand, which mitigated concerns and helped to offset weak data that showed a slowdown in German exports.

Asian markets, meanwhile, were lower Wednesday as the yen touched a 15-year high against the dollar. Japan's Nikkei shed 2.2%, while Hong Kong's Hang Seng slid 1.5%.

U.S. stocks came off their session highs in the wake of the release of the Federal Reserve's beige book, which recounted "widespread signs of deceleration" despite continued tepid growth.

Around the same time, President Obama pointed to the struggling economy as the motivating force behind a series of new proposals aimed at boosting growth, including a $50-billion infrastructure spending package, new research and development tax credits and a proposal that would allow companies to hasten write-offs on new plants and equipment through 2011. Speaking in Cleveland, the President argued against extending tax breaks to the wealthy, saying he foresaw an America where "the middle class is the economy's heart beat."

Peter Tuz of Chase Investment Council believes that the measures are priced in and are unlikely to resolve the uncertainties for U.S. businesses. "Personally, I think they (the proposals) are band-aids, short-term measures," he said ahead of the speech. "Getting clarity on tax-rates, health care costs is important to businesses to be able to make decisions to hire a person. I don't think today's moves- while nice- will make forecasting any easier." .

Also during the late afternoon session, the Fed said July consumer credit fell $3.63 billion, extending June's drop of $1.02 billion in June.

Eased EU bank fears bolstered the financial sector Wednesday and JPMorgan(JPM) was among the Dow's top performers after Alcoa(AA).

In corporate news, BP(BP) released its report on the oil spill on Wednesday morning. The company said that no single factor caused the spill. The stock gained 3.2% to $38.42.

Shares of Hewlett-Packard(HPQ) declined by 2.8% to $38.81 as the Mark Hurd saga continued. On Tuesday, Oracle named the former HP CEO as co-president, sending Oracle shares higher. Soon after the news broke, HP filed a lawsuit against Hurd for breach of contract.

Reacting to the move, Oracle CEO Larry Ellison said the HP lawsuit was "vindictive" and that it would impact the companies' working relationship. Oracle shares lost 0.5% to $24.14.

Rio Tinto's stock(RTP) rose 0.9% to $53.50 following reports that it is eyeing a Russian potash producer.