Stocks Higher as Market Looks to Extend Gains

Stocks in New York were modestly higher after searching for direction out of the gate Wednesday, losing some of the oomph of Tuesday's rally.

The Dow Jones Industrial Average was rising 23 points to 6949, and the S&P 500 higher by 3 points to 723. The Nasdaq was rising 5 points to 1364.

Investors are watching to see if stocks can lock in back-to-back days of gains, which hasn't happened for roughly a month. Stocks rallied on Tuesday after Citigroup ( C) chief Vikram Pandit offered some reassurance to investors and the market, saying the bank has had a profitable start to 2009.

The Dow and S&P 500 rose 5.8% and 6.4%, respectively, and the Nasdaq surged 7.1%. Banks in particular shot higher, with the KBW banking index rising 15.6%.

While Tuesday's movement was "a breath of fresh air," it's too early to say this is a bottom, said Peter Cardillo, chief market economist at Avalon Partners.

In banking news Wednesday, UBS ( UBS) revised its loss for 2008, widening it to $17.9 billion because of costs to settle a U.S. tax investigation and writedowns. The Swiss bank said in its annual report on Wednesday that the costs negatively impacted its 2008 earnings by 1.19 billion francs.

Wall Street is still keeping an ear out for more details on the Obama Administration's next-step bank relief plan. Treasury Secretary Timothy Geithner said Tuesday that the plan to deal with toxic assets that have been plaguing banks' balance sheets will be fleshed out more in the next few weeks.

Has the U.S. stock market reached its bottom?


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