Wall Street Ends Session With Modest Gains

November 25, 2008 5:38 p.m. EST

New York, NY (AHN) - U.S. markets were able to post modest gains Tuesday, marking the first string of three consecutive positive days since early September.

The major indices opened higher Tuesday after the Federal Reserve said it would purchase up to $600 billion in distressed mortgage backed assets. The Fed said $100 billion will be used to make purchases from Fannie Mae and Freddie Mac.

The Fed also announced a $200 billion program that lends to holders of securities backed by consumer loans.

The Dow Jones Industrial average added 36 points or 0.4 percent. The Dow components were relatively split between advancers and decliners. JP Morgan, up 7.9 percent helped the average produce a gain.

The S&P 500 rose 5 points or 0.6 percent on Tuesday. Eight of 10 major economic sectors finished the day with a gain. Materials, up 3.2 percent were the strongest sector followed by financials with a 2.5 percent gain.

Tech lagged as the Nasdaq Composite fell 7 points or 0.5 percent. The semiconductor stocks weighed on the Nasdaq as the sector fell 2.2 percent on the session.

The Federal Reserve news helped spark a rally in shares of lenders. SLM Corp (Sallie Mae), a provider of student loans, saw the sharpest rise, up 22 percent on the day.

Crude oil failed to continue its rally, falling $3.73 a barrel to settle at $50.77 on the New York Mercantile Exchange.

On the economic front, third quarter Gross Domestic Product was revised to negative 0.5 percent, in-line with expectations. However, the result marks the largest contraction in GDP since September 2001.

The Conference Board said Consumer Confidence moved up to 44.9 from 39.5 in October. The result topped economist's expectations for a reading of 39.5.

S&P/Case-Schiller reported home prices in 20 metro areas fell 17.4 percent in September.

Wednesday's session will see the release of initial unemployment claims for the week ending Nov. 22, along with October personal income and durable goods orders.