Stocks Edge Up to Baseline

Updated from 12:05 p.m. EDT

U.S. stocks shook off steep losses to trade near the baseline Thursday, as traders took in a flood of corporate earnings statements, saw evidence of additional turmoil in the financial sector and stomached a fresh serving of economic data.

The Dow Jones Industrial Average, which had slipped as much as 376 points, lately was up 14 points at 8592. The S&P 500 was edging down 2 points at 905, and the Nasdaq was up 15 points at 1643.

Art Hogan, chief market strategist at Jefferies, said that he believes the market bottomed at its intraday low on Friday, and the markets will not even return to test that. "We're still convinced that the punishment is not fitting the crime and we're overdoing it here." He said the market is seeing indiscriminate selling as firms continue to try to raise cash.

Ahead of Wednesday's trading, Swiss bank UBS ( UBS) received a $5.3 billion cash injection from the Swiss government in exchange for a 9% equity position in the company. UBS and the Swiss National Bank also reached an agreement for UBS to transfer up to $60 billion of currently illiquid securities and other assets from its balance sheet to a separate fund.

There was trouble back in the U.S. as well. Bloomberg reported that Citadel Investment Group's largest hedge fund lost as much as 30% this year on bad bets in convertible bonds, stocks and corporate debt. And the need for hedge funds like Citadel to liquidate is a likely contributor to the market's recent volatility.

Corporate earnings were once again in focus. Following the close Wednesday, online auctioneer eBay ( EBAY) swung to a third-quarter profit but said its core business may face difficulties ahead.

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