NEW YORK (AP) ? Stocks rose Wednesday morning, putting the market on track for a third day of gains after a four-week slump. The price of gold slumped 5 percent as investors became less fearful.
A sharp increase in orders for long-lasting goods in July countered a series of poor economic reports in the past two weeks that got investors worried that the U.S. was headed for another recession.
In morning trading the Dow Jones industrial average rose 67 points, or 0.6 percent, to 11,244, reversing an earlier loss. It jumped 322 points the day before, the biggest gain since August 11.
Two days after trading above $1,900 an ounce for the first time, gold fell $86 to $1,774 as investors became less skittish. In other signs that investors were more willing to take on risk, the dollar fell against other currencies and the VIX, a measure of stock market volatility, fell 4 percent to 35. The VIX traded as high as 48 Aug. 8 after staying below 20 for much of the year.
Bank of America Corp. rose 8 percent, the most of any stock in the Dow average, after analysts said a four-day slide that erased 15 percent of the bank’s value had been overdone.
The S&P 500 index rose 7 points, or 0.6 percent, to 1,169. It gained 38 points Tuesday, also its best day since Aug. 11. The Nasdaq rose 8 points, or 0.3 percent, to 2,454.
The Commerce Department reported that companies placed more orders for aircraft, automobiles and other durable goods in July. Orders for longer-lasting goods rose 4 percent, the biggest increase since March. They had dropped 1.3 percent in June. The report eased fears that the U.S. was headed for another recession.
Stock indexes jumped sharply Tuesday, as investors brushed off a pair of weak economic reports and an earthquake that shook the East Coast. Even after Tuesday’s rally the Dow is down 8 percent in August. The S&P 500 index has lost 11 percent, putting it on track for its worst August since 1998.
Wild swings have become commonplace this month after Europe’s debt crisis flared up again and as signs emerged that the U.S. might slip back into recession. The Dow has swung by more than 300 points seven days in August.
Asian markets fell after Moody’s lowered Japan’s credit rating. Japan’s Nikkei 225 index fell 1.1 percent.
