Feeling reassured, investors lift stocks

NEW YORK – Stocks came off early losses to finish higher Wednesday as investors set aside some concerns about the economy after finding reassurance that the Federal Reserve remains committed to shoring up the economy.

A rebound in hard-hit stocks of financial companies helped fuel the session’s turnaround, while an upbeat forecast from Hewlett Packard Co. pulled technology issues higher and record prices for oil gave a boost to energy stocks.

Stocks began the day lower amid concern about a rise in consumer prices and lackluster readings on home construction. But observers said the economic figures ultimately weren’t all that surprising given a recent run-up in oil prices and the well-documented woes of the housing sector.

Investors had already begun to check some of their concerns when minutes from the Fed’s meetings last month indicated the central bank didn’t seem to be extremely worried about inflation. The apparent lack of urgent concern that lower interest rates would foment a rise in prices was perhaps welcome given the latest readings on consumer prices and the rise in oil.

The Fed minutes underscored the notion that policymakers will first address the flagging economy and turn later to inflation. Some bargain hunters waded into the markets to snap up stocks of beaten down sectors like financials.

The Fed lowered key interest rates by a half-point to 3 percent on Jan. 30, following an emergency three-quarter point cut the prior week.

The Dow Jones industrial average rose 90.04, or 0.73 percent, to 12,427.26 after at one point being down nearly 110 points.

Broader stock indicators also moved higher. The Standard & Poor’s 500 index advanced 11.25, or 0.83 percent, to 1,360.03, and the Nasdaq composite index rose 20.90, or 0.91 percent, to 2,327.10.

Overseas, Japan’s Nikkei stock average closed down 3.25 percent. Britain’s FTSE 100 closed down 1.23 percent, Germany’s DAX index lost 1.47 percent, and France’s CAC-40 fell 1.49 percent.