U.S. stocks had another wild swing in the final 15 minutes of trading that pumped up the Dow from a gain of about 50 points to nearly 200 points as traders shrugged off this morning's GDP report that showed the economy is shrinking.
The Dow Jones Industrial Average ended up 189.73, or 2.1 percent, at 9180.69, after shedding 74 points in the previous session, when the market experienced an intense selloff in the final minutes of trading.
The violent late-day swings we've seen in the market lately may seem pretty scary but market pros say they're actually fairly common at the end of a bear market.
The S&P 500 gained 24 points, or 2.6 percent, to close at 954.09, while the Nasdaq rose 41.31, or 2.5 percent, to close at 1698.52.
Today's rebound comes on the heels of a major rally in Asia: Japan's Nikkei index shot up 10 percent and South Korea's Kospi index soared 12 percent as investors cheered international efforts to boost liquidity in emergency markets and the prospect of lower borrowing costs. European shares received a boost from Deutsche Bank, which delivered better-than-expected results, averting a loss thanks to new accounting rules.
American depositary shares of Deutsche Bank gained 19 percent on the New York Stock Exchange.
With one day left in month, the market is on track for its worst month since the 1987 crash. As of today's close, the Dow is down 15 percent for the month.
"It looks less and less likely that we’re going to get a significant retest and/or break of the lows," Art Cashin, director of floor operations at UBS, told CNBC. "This rally looks like it might have some legs."
Cashin cited two key levels in the S&P 500: 970, yesterday's high, and 985, which the index needs to break through in order to get some conviction in this rally. The index ended around 954 today.
Still, he said, we're just seeing the tip of the iceberg in terms of the recession.
"I do think before a year from now … the full effect of the recession will begin to hit. That hasn’t even been thought of, really, yet," Cashin said.
Indeed, recessions are often defined as two consecutive quarters of negative GDP growth and today we got the first half of that equation: The economy contracted at a 0.3 percent annual ratein the third quarter, the Commerce Department reported in the first of three readings on GDP for the quarter. That was the weakest growth rate since 2001 but still beat expectations, which called for a 0.5-percent decline.
"This is the first of a run of negative GDP numbers; the economy is in recession," said Ian Shepherdson, chief U.S. economist at High Frequency Economics. His team expects GDP to have dropped 1 percent in both the fourth quarter and the first quarter of 2009.
Meanwhile, initial jobless claims held steady at 479,000 last week; economists had expected the gauge to drop to 475,000.
ExxonMobil shares rose 0.5 percent after the oil giant blew past expectations, reporting net income of $14.96 billion, or $2.86 a share — $2.59 a share excluding items. On average, analysts had expected the oil giant to earn $2.38 a share.
Colgate-Palmolive shares advanced 7.1 percent after the company, which makes everything from Colgate toothpaste to Speed Stick deodorant, beat estimates, helped by price increases and demand from emerging markets.
American Express shares gained 3.4 percent after the credit-card provider said it plans to cut 7,000 jobs, or about 10 percent of its work force.
Techs charged ahead as analysts said the sector will be one of the biggest beneficiaries when the economy comes back.
Shares of iPhone maker Apple added 6.2 percent.
Intel and Hewlett-Packard were the biggest gainers on the Dow, rising 8.2 percent and 6.5 percent, respectively.
General Motors was the biggest drag on the Dow, falling more than 10 percent.
Hartford Financial Services tumbled 52 percent after the insurer posted an unexpectedly large loss. That came a day after Prudential Financial missed expectations. Its share fell 18 percent Thursday.
Target shed 5.7 percent, a day after hedge-fund manager William Ackman urged the retailer to spin off its real-estate division.
Other retailers were mixed, with department stores like Macy's advancing, and specialty shops such as AnnTaylordeclining.
Staples shot up 16 percent after the office-products retailer said it expected to beat earnings estimates.
Housing stocks rose as a $600 billion plan is being hammered out by the Federal Deposit Insurance Corp and the U.S. Treasury that could provide guarantees for up to 3 million at-risk mortgages, according to Reuters.
And New York Attorney General Andrew Cuomo is demanding information about executive compensation and bonuses at nine banks that have received federal funds under the Treasury's bailout program.
In a letter to each bank's Board of Directors, Cuomo warns the bonuses could violate New York's state fraudulent conveyance law.
Still to Come:
FRIDAY: Personal income and spending; consumer sentiment; Fed's Yellen speaks; Earnings from Chevron, Clorox and Nissan
Send comments to cindy.perman@nbcuni.com.
