NEW YORK — Financial markets grew more upbeat Thursday as political leaders said they struck an agreement in principle on a massive spending plan to revive the crippled financial system. The Dow Jones industrial average jumped about 200 points on optimism about the bailout, and demand for haven assets remained high but eased slightly as some investors placed bets that a deal would help unclog credit markets.
Stock-market investors got a lift when key lawmakers said they would present the $700 billion plan to the Bush administration and hoped for a vote by both houses of Congress within days.
Still, some resistance remained from House Republicans as the closing bell on Wall Street rang ahead of a meeting of congressional leaders at the White House.
Investors’ mood has fluctuated this week as they watched the negotiations on the plan gain momentum, and trading is likely to remain difficult in the coming days.
“The market’s going to experience volatility as the terms become known,” said Doug Roberts, chief investment strategist at Channel Capital Research.
The latest statements of support for the rescue effort came after Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke urged lawmakers Tuesday and Wednesday to quickly sign off on the plan, which they said would help prop up the economy by removing billions of dollars in risky mortgage-related assets from financial firms’ balance sheets.
Fear of heavy losses on these assets has made banks hesitant to extend credit, which in turn threatens the overall economy by making it harder and more expensive for businesses and consumers to borrow money.
The Dow rose 196.89, or 1.82 percent, to 11,022.06. The gain helped the Dow erase losses from heavy selling earlier in the week, though the blue chips still remain down more than 360 points, or 3.2 percent.
Broader stock indicators also rose Thursday. The Standard & Poor’s 500 index advanced 23.31, or 1.97 percent, to 1,209.18, and the Nasdaq composite index rose 30.89, or 1.43 percent, to 2,186.57.
