Updated from 9:15 a.m. EDTStocks in New York opened higher Thursday as the prospect of a quick bailout for financial firms trumped a gloomy earnings forecast from General Electric ( GE) and discouraging economic data. The Dow Jones Industrial Average was up 80 points at 10,906, and the S&P 500 climbed 7.2 points to 1193. The Nasdaq added 16 points to 2171. On Wednesday, the three major indices finished narrowly mixed after a day of erratic trading. Investors were focused on Treasury Secretary Henry Paulson's $700 billion bailout plan for the financial sector. Speaking Wednesday evening in Washington, D.C., President Bush called for a quick approval of the Treasury's plan and warned the economy would face a recession if the package were not approved. Bush called an emergency meeting with presidential candidates John McCain and Barack Obama, as well as certain members of Congress, to work out a plan to pass the bill. After Bush's speech, Rep. Barney Frank, chairman of the House Financial Services Committee, told CNBC that he believed the bill would pass. Back on Wall Street, harried bank Washington Mutual ( WM) was approaching private equity companies, including Carlyle Group and Blackstone ( BX), about a potential takeover, according to a report in the Wall Street Journal Thursday. Industrial conglomerate General Electric lowered its third-quarter profit forecast and suspended its stock-buyback program, citing weakness in the financial markets.
In analyst actions, Stifel Nicolaus initiated coverage of the airlines, assigning buy ratings to United parent UAL ( UAL), Delta ( DAL), Continental ( CAL) and American parent AMR ( AMR). Southwest ( LUV) garnered a hold rating from Stifel. Looking at the day's economic data, the Census Bureau reported August durable-goods orders fell by 4.5%, a far wider decline than the 1.3% drop expected by economists and down from a 0.8% increase in July. The Department of Labor reported that jobless claims for the week ended Sept. 20 came in at 493,000, ahead of analyst forecast of 450,000 and up from 461,000 in July. A bit later, the Census bureau also is slated to report on new-home sales for August. The price of crude oil was down $1.85 to $103.88 a barrel. Gold was down $7.30 to $887.70 an ounce. Longer-term U.S. Treasury securities were rising in price. The 10-year was up 10/32 to yield 3.78% and the 30-year was gaining 1-2/32, yielding 4.35%. The dollar was weakening vs. its major foreign competitors. Overseas, European exchanges such as the FTSE in London and the DAX in Frankfurt were gaining. In Asia, Japan's Nikkei and Hong Kong's Hang Seng finished with losses.