Stocks rallied Thursday, pushing the Dow Jones industrial average up 400 points, after a report that the U.S. government is considering creating an entity to take over banks' bad debt. The reports suggested that U.S. Treasury Secretary Henry Paulson is considering the formation of an entity like the Resolution Trust Corporation that was set up during the savings and loan crisis of the late 1980s and early 1990s. The report was the first bit of good news Wall Street has had this week, where investors are still reeling from the collapse of Lehman Brothers and worrying about the health of the remaining three big U.S. investment banks. According to preliminary calculations, the Dow rose 410.03, or 3.86 percent, to 11,019.69, surging 560 points from its low of the day, 10,459.44. Broader stock indicators also jumped. The Standard & Poor's 500 index rose 50.01, or 4.32 percent, to 1,206.60, and the Nasdaq composite index advanced 100.25, or 4.78 percent, to 2,199.10. The New York Stock Exchange composite rose 334.77 to close at 7,775.16, while the American Stock Exchange composite closed up 78.07 at 1,872.46. The Russell 2000 also closed higher, up 47.30 at 723.68. The price of a barrel of light, sweet crude oil for October delivery rose 72 cents to $97.88.
