Stocks open higher and stay that way. The Dow gains some 186 points to close at 2027. Trading volume declines but remains at more than twice the daily average.
The blue-chip index posts its biggest gain ever and investors are spared another roller coaster ride. Stocks of all kinds rally, with winners outpacing losers by an eight-to-one margin. Corporate share buybacks continued to help the mood as did talk of lower interest rates and a budget compromise in Washington. Suddenly, investors are ready to jump back into the market. Commodities prices also stage impressive rallies and stock markets overseas bounce back. There's a sense the worst is over.
(Part 1) [04:21]
In Washington, Reagan administration officials met with Congressional leaders and agreed to start negotiations on how to trim the budget deficit. Talk of lower interest rates sounds good to Wall Street. When asked if the market crisis is over, the President says it appears so.
(Part 2) [02:48]
The White House has been trying to talk down interest rates and two major banks respond by lowering their prime rates. High consumer debt remains a concern and lower rates are seen as a key to the continuation of strong consumer spending, especially with the start of the holiday shopping season just a month away.
(Part 3) [02:31]