Stocks start the session with strong gains. The advance is the most pronounced in the financial sector, which is up 3.5%.
Participants are pushing shares of financial companies higher since the
sector will be the most immediate beneficiary of a federal plan to
acquire distressed assets, particularly difficult to trade
mortgage-backed securities. The plan proposes to fund the purchases
with $700 billion and is currently up for vote in the House of
Representatives.
Though the plan would help create a market for many of the distressed
assets that are driving losses at financial institutions, threats to
the broader economy loom.
September nonfarm payrolls declined 159,000, exceeding the consensus
forecast of a 105,000 decline. The decline was the largest since early
2003. Losses continue in construction, manufacturing, and retail. The
unemployment rate remains at 6.1%.