NEW YORK — Investors did an abrupt turnaround on Wall Street on Thursday, muscling the Dow Jones industrial average up more than 550 points after driving it down near its lows for the year on a stream of negative economic and corporate news.
After three days of selling that wiped out about $1 trillion in shareholder value, many investors, though nervous about a prolonged economic downturn, appeared convinced the market had priced in enough bad news. So when the Standard & Poor’s 500 index — the indicator most watched by traders — managed to recover from multiyear trading lows, buyers swarmed back in.
It’s “a herd mentality,” said Ryan Larson, senior equity trader at Voyageur Asset Management. “We started going higher — and you don’t want to be the last one on the boat.”
The market was following in dramatic fashion its pattern of huge price reversals, one that was set early in the now- 15-month-old credit crisis and that has become almost the norm on Wall Street.
Some analysts said investors were positioning themselves ahead of a meeting of Group of 20 leaders in Washington. The meeting could bring decisions on mending the troubled global financial system. The G-20 comprises the U.S., Argentina, Australia, Brazil, Britain, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea and Turkey.
The biggest gainer among the 30 Dow companies was Chevron Corp., which rose $8.43, or 12.5 percent, to $75.71.
The Dow rose 552.59, or 6.67 percent, to 8,835.25, after falling as low as 7,965.42 and rising as high as 8,876.59. That’s a trading range of 911 points. The Dow did not sink below its Oct. 10 trading low of 7,882.51.
The Standard & Poor’s 500 index rose 58.99, or 6.92 percent, to 911.29, after dropping to 818.69 — well below its previous intraday low of 839.80 set Oct. 10.
The Nasdaq composite index rose 97.49, or 6.50 percent, to 1,596.70.
