NEW YORK - Wall Street pulled off a big turnaround Thursday, rebounding from a steep early drop to finish modestly higher. Investors who began the day worrying about a revival of the banking crisis grew optimistic during the session that the government will again help the financial industry.
The sell-off, which followed news that Bank of America Corp. needed another government cash infusion, had the Dow Jones industrials heading for a seventh straight loss. But investors awaiting a Senate vote authorizing the second $350 billion from the government's financial bailout fund became more upbeat as the day wore on. They were hoping additional money from Washington will help stabilize banks; lawmakers approved the money after the market closed.
The market's zigzag was reminiscent of the enormous volatility seen in September and October, when worries about mounting troubles at banks and the collapse of brokerage Lehman Brothers Holdings Inc. pummeled Wall Street. Swings of hundreds of points in the Dow industrials were at times terrifying but began to feel almost commonplace. Wall Street has shown relative tranquility since late November but still remains in a bear market, which can produce sharp turns.
The Dow rose 12.35, or 0.15 percent, to 8,212.49 after falling the past six days. The Dow was down as much as 205 in the session and briefly slipped below 8,000. That was the first move below that psychological benchmark since Nov. 21, a day after the blue chips closed at their lowest level in more than five years.
Broader stock indicators advanced Thursday. The Standard & Poor's 500 index rose 1.12, or 0.13 percent, to 843.74 and the technology-heavy Nasdaq composite index rose 22.20, or 1.49 percent, to 1,511.84.
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