US stocks on the up

Wall Street resumed its rally today, rising moderately as investors saw rebounding commodities prices as a reason to snap up energy and materials stocks.

Commodities prices that have been skidding lower for months turned around as investors seemed to have more of an appetite for risk.

Gold picked up more than $36 an ounce. That advance spilled over to the stock market, lifting energy stocks including Exxon Mobil Corp., which rose 2.4%, and mining company Freeport-McMoRan Copper & Gold Inc., which added 16%.

Shifting sentiment over a possible bailout deal for Detroit’s Big Three automakers tugged at stocks throughout the session.

That had major indexes alternating between gains and losses in afternoon trading and dragged financial stocks lower. Financial houses that hold investments in the car companies could see further strain on their balance sheets if big players like General Motors Corp. file bankruptcy.

The session’s gains represent the continuation of the market’s advance since late November. It has been punctuated by a few steep sell-offs, including Tuesday’s slide.

But most trading had been more subdued than in September and October. The less panicked tone has helped boost confidence that the market might be stitching together a sustainable bottom.

Wall Street remains nervous about the level of opposition to efforts to aid US automakers. Democrats in Congress and the White House finalised an agreement on 14 billion in loans for Detroit’s struggling car companies. However, the plan negotiated by the White House is being opposed by a group of conservatives led by Sen John Ensign, a Nevada Republican.

The proposal would provide relief for General Motors and Chrysler. Ford Chief Executive Alan Mulally and Executive Chairman Bill Ford Jr. said they don’t need to take the bailout.

According to preliminary calculations, the Dow Jones industrial average rose 70.09, or 0.81 %, to 8,761.42. On Tuesday, the Dow shed 243 points as investors after disappointing corporate news reminded investors of the magnitude of the economy’s troubles. Stocks have rallied for two sessions before the decline.

Broader stock indicators advanced. The Standard & Poor’s 500 index rose 10.57, or 1.19%, to 899.24, and the Nasdaq composite index rose 18.14, or 1.17%, to 1,565.48.

The Russell 2000 index of smaller companies rose 10.69, or 2.30%, to 476.40.