Updated from 11:04 a.m. EDT
U.S. stocks were jumping higher Thursday after a broad, deep selloff Wednesday, as beaten-down energy stocks rebounded to provide leadership in the rally.
Dow Jones Industrial Average
was gaining 187 points to 8706, and the
added 13 points to 910. The
was adding 10 points to 1626.
Integrated oil firms
led the Dow higher with gains of more than 5%. The
Energy Select SPDR
, which tracks energy stocks, was lately up 4.5%.
Crude oil futures were gaining $1.73 to $68.48 a barrel.
"Right now it looks like we're seeing a bit of a reaction to yesterday's selloff," said Darin Newsom, senior commodities analyst at DTN. He said that the move higher for oil futures and energy stocks may be short-covering ahead of an OPEC meeting on Friday, during which the cartel is expected to cut production.
However, the larger issue is demand, said Newsom. "There's something like 20 countries listed in a recessionary category at this time. ... It's going to take more to turn the oil industry, oil futures, oil stocks around in the long term," he said.
On Wednesday, stocks sold off steadily as many companies, citing an impending economic downturn, cautioned investors not to expect much in coming months.
The new day's economic data lent support to U.S. companies' cautious prognostications. The Department of Labor's jobless numbers for the week ended Oct. 18 unexpectedly rose by 15,000 to 478,000. Economists were expecting 468,000 unemployment claims for the week.
In addition, home foreclosures were up 71% year over year to 766,000 for the third quarter as home prices declined, according to
. Separately, the Federal Housing and Finance Agency said its home price index slipped 0.6% from July to August and fell 5.9% year over year.
As the economic outlook worsened, the government looked ready to aid homeowners. The Bush administration is mulling a $40 billion program to prevent
, according to a report in
The Wall Street Journal
News from large U.S. firms was corroborating the pessimism. The
is planning on cutting its workforce by 10% as it copes with the credit crunch.
announced it would also
more workers and temporarily cut employee benefits in an effort to cut costs. Fellow automaker
said it would close a plant in Newark, Del., and eliminate a shift at a plant in Ohio as it sheds 1,800 workers.
Another day of earnings produced a mixed bag of quarterly results. In forecasting future results some companies were timid, while others showed more optimism in the face of a likely downturn.
During this week of earnings season, stocks typically trade in sectors on a single company's earnings, said Marc Pado, U.S. market strategist at Cantor Fitzgerald. He said that as additional reports roll out next week, stocks will begin trading more in line with their individual results.
Pado also said companies often strive to lower investor expectations during the third quarter so that they can end the fourth quarter on a high note. "You're seeing, across the board, all these companies are really setting the bar low."
Although the market doesn't look to spend much time below the lows achieved earlier this month, "we could very well be in for a year-long consolidation," said Pado.
Following Wednesday's close, online retailer
beat estimates, but the company lowered its forecast for the fourth quarter.
In the biotech arena,
announced solid earnings and lifted its forward guidance.
Ahead of the new session, fellow biotech firm
announced a 251% increase in profit, trumping Wall Street's expectations. Pharmaceutical company
swung to a loss on charges related to a government probe into its Zyprexa drug.
Among chemicals companies,
said third-quarter earnings rose as sales jumped 13%. Fertilizer concern
likewise saw earnings surge in its most recent quarter.
slashed its fiscal 2009 outlook in half in part because a strengthening yen would hurt currency conversions from overseas sales.
, meanwhile, reported earnings that beat analysts' estimates but warned of challenges in coming quarters.
said that its profit declined 67% year over year, but on an adjusted basis the company beat estimates.
Longer-dated U.S. Treasury securities were edging lower. The 10-year was down 10/32 to yield 3.63%, and the 30-year was losing 4/32, yielding 4.06%. The dollar was flat vs. the euro and gaining on the pound but softening vs. the yen. Gold was down $12.70 to $722.50 an ounce.
Overseas, European exchanges were mixed, as the FTSE in London worked higher while the Dax in Frankfurt was taking losses. In
, Japan's Nikkei and Hong Kong's Hang Seng closed on the downside.