Stocks on Wall Street surge to a close

Stocks capped a week of huge gains with a sizeable advance today after Wall Street set aside some anxiety over news on jobs and focused on Microsoft’s bid for Yahoo and a possible rescue plan for the troubled bond insurance sector.

According to preliminary calculations, the Dow Jones industrial average rose 92.83, or 0.73%, to 12,743.19 after climbing more than 200 points yesterday.

Broader stock indicators also rose. The Standard and Poor’s 500 index rose 16.85, or 1.22%, to 1,395.40, and the Nasdaq composite index advanced 23.50, or 0.98%, to 2,413.36.

The Russell 2000 index of smaller companies rose 17.20, or 2.41%, to 730.50.

Advancing issues outnumbered decliners by more than 3 to 1 on the New York Stock Exchange, where volume came to 1.79 billion shares compared with 2.19 billion shares traded yesterday.

Bond prices showed little movement. The yield on the benchmark 10-year Treasury note, which moves opposite its price, stood unchanged at 3.59 % from late Thursday.

The dollar was mixed against other major currencies, while gold prices fell.

Stocks climbed today after a week in which Wall Street saw huge gains but also enormous volatility. The week began with a sharp advance as investors awaited the Federal Reserve’s decision on interest rates. Stocks extended their gains Tuesday and on Wednesday the central bank delivered on a widely expected half-point cut in interest rates. But unease about bond insurers short-circuited a rally in stocks after the rate cut.

Stocks sold off again early yesterday but performed an about-face to close sharply higher as investors considered the effects of rate cuts and the possibility that the government might orchestrate a rescue for the trouble bond insurance market.

The latest rate cut meant the Fed had slashed rates by an unprecedented 1.25% in little more than a week, a move that appeared to largely erase doubts about whether the central bank would step in to assuage investors’ fears about the health of the financial sector and, more broadly, of recession.

The week’s gains restored some of the huge losses seen in the earliest days of the year. Still, stocks this week finished what was their worst January since 1990. The Standard & Poor’s 500 index, the market measure most closely followed by professional traders, lost 6.1% for the month.

Bond insurers showed gains today amid word that efforts are moving ahead to aid the troubled bond insurance market. Ambac Financial Group rose 1.56, or 13 %, to 13.20, while MBIA rose 86 cents, or 5.6 %, to 16.36.

In corporate news, Yahoo surged 9.20, or 48%, to 28.38, on word of the buyout offer for 31 per share. Yahoo said it would consider the offer. Microsoft, one of the 30 stocks that make up the Dow industrials, fell 2.15, or 6.6%, to 30.45.

Google fell 48.40, or 8.6 %, to 515.90 after reporting its fourth-quarter earnings and revenue growth slowed at a faster pace than Wall Street expected.

Motorola jumped 1.19, or 10%, to 12.69 after announcing it is considering selling a sale or spinoff its lacklustre mobile phone business.