By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks ended mostly up on
Wednesday, with the Dow industrials and the S&P 500 rebounding
after a two-day hit, buoyed by talks to end the government shutdown
now in its ninth day and with little more than a week to go before
U.S. borrowing authority expires.
"I think we're getting a glimmer of hope," said Art Hogan, a
market strategist at Lazard Capital Markets LLC. "There seems to be
a conversation going in the background that the way to exit this
mess is a short-term lifting of the debt ceiling, and as a reward,
an agreement for both sides to sit down and discuss budget issues,"
he added.
House leaders from both parties met on Wednesday. In addition,
President Barack Obama will meet with House Republican leaders and
committee chairmen, according to a statement from House Speaker
John Boehner's spokesman.
The stock market offered little reaction to the Federal
Reserve's release of minutes from its September meeting, at which
the Fed unexpectedly refrained from tapering its $85 billion in
monthly asset purchases. The minutes showed most Fed members think
it would still make sense to scale back bond buying this year.
Janet Yellen, vice chairwoman of the Federal Reserve, was nominated
Wednesday afternoon to succeed Ben Bernanke as Fed chief.
After a 52-point drop and 76-point advance, the Dow Jones
Industrial Average (DJI) finished up 26.45 points, or 0.2%, at
14,802.98.
The S&P 500 index (SPX) rose nearly 1 point, or nearly 0.1%,
to 1,656.40, with telecommunications the best performing and
consumer discretionary the laggard among its 10 major industry
sectors.
Darden Restaurants Inc. (DRI) shares jumped 7.1%. The Wall
Street Journal, citing people familiar with the matter, reported
hedge fund Barington Capital LP had taken a 2.8% stake in the owner
of the Olive Garden and Red Lobster restaurants, and was pushing
for Darden to split.
Shares of Hewlett-Packard Co. (HPQ) rallied 8.9% after Chief
Executive Meg Whitman said the company is poised to see "pockets of
growth" in 2014.
Alcoa Inc. (AA) rose 2% a day after the aluminum producer
reported better-than-anticipated quarterly earnings. (Read more on
Alcoa results:
http://blogs.marketwatch.com/thetell/2013/10/08/what-alcoas-results-say-about-global-manufacturing/.)
Shares of Jos. A. Bank Clothiers Inc. (JOSB) and Men's Wearhouse
Inc. (MW) rallied after Men's Wearhouse spurned the former's buyout
offer.
The Nasdaq Composite (RIXF) declined 17.06 points, or 0.5%, to
3,677.78.
Decliners just outpaced advancers on the New York Stock
Exchange, where 732 million shares traded. Composite volume
approached 3.6 billion shares.
U.S. stocks fell sharply in the last two sessions, with the
S&P 500 ending Tuesday at the lowest level since Sept. 6, hit
by worries about the government shutdown and looming debt-ceiling
deadline.
"I wish I could be watching earnings and economic data, but the
goofiness in Washington is pretty much taking all the air out of
the room," said Paul Nolte, managing director at Dearborn
Partners.
"The market is starting to slowly price in a chance of default;
we don't pay our bills, everybody takes a look at the U.S. a little
differently at that point. That's part of why I think we'll get a
deal, but it's politics not finance," said Nolte, who believes the
stock market could drop as much as 10% should politicians fail to
hike the nation's debt ceiling before an Oct. 17 deadline.
Treasury prices fell, with the yield on the 10-year note
(10_YEAR) used in figuring mortgages and other consumer loans up 3
basis points at 2.667%.
The dollar(DXY) gained against the currencies of major U.S.
trading partners, including the yen (USDJPY) and the euro (EURUSD),
while the price of dollar-denominated commodities declined, with
oil futures off $1.88, or 1.8%, at $101.61 a barrel and gold
futures down $17.40, or 1.3%, to close the floor session at
$1,307.20 an ounce.
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