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Bank stocks finished mostly higher, with JPMorgan and Bank of America among the top gainers on the Dow. But Citigroup slipped.
Another thing that helped cool investors' heels was news that General Motors has reached a debt-for-equity deal with bondholders. Bondholders will start with 10 percent equity, with 7.5 percent more when GM's market cap reaches $15 billion and $30 billion market.
Investors cheered the deal but GM will still likely have to file for bankruptcy protection.
Speaking of which, Ford's largest parts maker, Visteon, filed for Chapter 11 bankruptcy protection for its U.S. operations.
Ford shares initially slipped but finished up with a 4.1-percent gain.
Oil stocks — including Dow components ExxonMobil and Chevron — shot higher after this morning's report that crude inventories were pared down by 5.413 million barrels last week, a much bigger decline than the 500,000 draw-down expected. The report is typically released on Wednesdays but came out today due to the Memorial Day holiday.
Earlier, OPEC said it will keep output unchangedand instead focus on increased compliance. The organization also demanded that it not be referred to as a cartel anymore.
In the day's economic news: New-home sales ticked up 0.3 percentto a seasonally adjusted rate of 352,000 in April, less than expected, and March sales were revised sharply lower.
Meanwhile, initial jobless claims dropped by 13,000to 623,000 from a slightly revised 636,000, while continuing claims rose to another record around 6.8 million. And durable-good orders rose 1.9 percent in April but enthusiasm was tempered by a sharply lower revision for March.
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Shares of Procter & Gamble rose even as the maker of Gillette razors and Tide laundry detergent slashed its outlook, projecting 2010 net sales in a range of down 2 percent to up 1 percent.
In other earnings news, Costco Wholesale said its profit fell 29%as the company struggles to pare back its discretionary items and offer more staples.
And Toys R Us said late Wednesday it has acquired rival FAO Schwarz for an undisclosed sum.
Dallas Federal Reserve President Richard W. Fisher will talk at 6:20 pm New York time on the current economic crisis in Washington.
Time Warner announced plans to spin off its AOL Internet divisionsometime near the end of the year.
Dell shares rose ahead of earnings from the computer maker, due out after the closing bell. Analysts polled by Thomson Reuters expected earnings of 23 cents a share.
Still to Come:
THURSDAY: Fed's Fisher speaks; Earnings from Dell after the bell
FRIDAY: GDP; Chicago PMI; University of Michigan/Reuters consumer sentiment; earnings from Tiffany
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