Bulls Charge on Housing Bill, Jobs Data

A new housing recovery bill becomes law and July payroll data show a suprise increase.
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Updated from 9:52 a.m. EDT

Stocks in New York continued in high gear Wednesday following the signing of a government housing relief bill and the release of encouraging employment data.

The

Dow Jones Industrial Average

was climbing 97 points to 11,495, and the

S&P 500

was up 11 points at 1274. The

Nasdaq

was adding 10 points at 2330.

In the previous day's trading session, the three major indices each added more than 2% as crude oil dropped as low as $121.10 a barrel and

Merrill Lynch

(MER)

managed to offload some mortgage-backed assets from its balance sheet.

Wednesday morning, President Bush signed into law a housing bill that would help struggling homeowners and offer support for troubled mortgage companies

Fannie Mae

(FNM)

and

Freddie Mac

(FRE)

. Bush had previously threatened to veto the bill because of provisions he said would help lenders that contributed to the current housing crisis.

Citing ongoing fragility in the financial system, the

Federal Reserve

also said it would leave its discount window, as well as its term securities lending facility, open to investment banks until Jan. 30, 2009. The primary dealer credit facility was originally slated to close in September.

Earnings season, meanwhile, remains in full swing. After the close Tuesday, video-game maker

Electronic Arts'

(ERTS)

financial results

fell short of estimates

.

Similarly, life insurance provider

MetLife

(MET) - Get Report

reported earnings that fell year over year and failed to meet analysts' expectations.

Before the new day's trading got underway, cable operator

Comcast

(CMCSA) - Get Report

announced a 7.5% increase in profit from the year-ago quarter, although growth in its subscription base was slowing. Glass producer

Corning

(GLW) - Get Report

, meanwhile

reported growing profits but offered tepid guidance

for the third quarter.

Steel producer

ArcelorMittal

(MIT)

reported that second-quarter profit more than doubled as demand allowed it to pass rising raw materials costs on to clients.

Ratings agency

Moody's

(MCO) - Get Report

reported declining profit but beat expectations and affirmed its full-year outlook. Navigation-device maker

Garmin

(GRMN) - Get Report

, on the other hand,

delivered an earnings miss

.

Elsewhere, the

Securities and Exchange Commission

extended until Aug. 12 its ban on naked short-selling of Fannie Mae, Freddie Mac and brokerages.

Shifting over to commodities, crude oil was adding 89 cents at $123.08. Gasoline prices continued their decline, as the average reached $3.926 a gallon, down from $3.941 Tuesday and $4.086 a month ago. Gold was losing $19.50 at $906.90.

In economic data, the Energy Information Administration said that gasoline inventories for the week ended July 25 fell by 3.5 million barrels last week, whereas analysts were looking for an increase in supply of 400,000 barrels. Oil inventories fell by 100,000 barrels to 295.2 million barrels, a smaller decline than the 1.3 million barrels expected by economists.

Meanwhile, Automatic Data Processing's July payroll report showed an increase of 9,000 jobs, above the consensus estimate for a loss of 60,000, and an improvement over a loss of 79,000 in June.

Separately, the Mortgage Bankers Association showed mortgage application volume for the week ended July 25 declining 14.1% to its lowest level this year.

Treasury prices were declining. The 10-year note was falling 10/32, yielding 4.08%, and the 30-year was shedding 19/32 to yield 4.66%. The dollar was gaining against the euro and the yen, but down vs. the pound.

Most global exchanges, including London's FTSE, Frankfurt's DAX, Tokyo's Nikkei and Hong Kong's Hang Seng, were gaining ground.