NEW YORK - A stock market gaining confidence in the nation's financial system bolted higher Wednesday, propelling the Dow Jones industrials and Standard & Poor's 500 index to their first four-day advance since last spring.
The market reversed losses from earlier in the session after President-elect Barack Obama pledged he would have a plan to deal with the nation's economic crisis on his first day in office. After filling more spots to his economic team, Obama stated that "help is on the way."
The major indexes built on their gains through the afternoon, but analysts warned that this latest advance came on light pre-holiday volume. The Dow is up 1,174 points, or 15.5 percent, during the past four days, and the S&P 500 is up 135, or 18 percent - giving both indicators their biggest four-day rise since the Great Depression. The rally marks a string of gains that seemed impossible to achieve in the depths of selling that began in mid-September after the collapse of Lehman Brothers Holdings Inc.
Analysts saw encouraging signs in the rally, but they were still cautious given months of extreme market volatility.
"Sentiment has turned slightly more positive over the past few days with some of the government packages in the U.S. and the stimulus programs that have been announced," said Michael Sheldon, chief market strategist at RDM Financial Group. "That might help turn the tide."
The government's latest steps aimed at restoring the nation's financial system to health came Tuesday, when the Bush administration and the Federal Reserve pledged $800 billion to boost lending on credit cards, auto loans, mortgages and other borrowing.
Analysts said some of the turnaround in stocks was due to the fact that the economic news was expected to be bad. Further, volume was about half of its normal levels on the floor of the New York Stock Exchange - with 1.4 billion shares traded - which can exacerbate price movements. Consolidated volume, which includes trades on other exchanges, came to 5.71 billion shares, compared to 6.72 billion on Tuesday.
The Dow industrials rose 247.14, or 2.91 percent, 8,726.61. The Dow has not had four straight gains since April 15-18; its advance is its biggest since 1932, during the Depression.