Stocks rose Wednesday at the end of a volatile session as a U.S. housing-sector merger and more optimism about the economic recovery overshadowed declining bank shares and the Federal Reserve's pessimistic outlook. Stocks rose through the early afternoon before retreating after the release of the notes from the Fed's policy meeting last month. The central bankers forecast a delay in the economic recovery until 2010, instead of the second half of this year. The Fed officials also believed the unemployment rate would rise more steeply into 2010. Light sweet crude oil for May delivery rose 23 cents to $49.38 a barrel on the New York Mercantile Exchange. Prices fell in the morning but gained sharply—peaking above $51—after the U.S. government's weekly report showed crude supplies increased less than expected. The U.S. dollar fell versus the euro and the yen. Pulte Homes is buying Centex in a $3.1 billion deal that creates the biggest U.S. homebuilder. The deal boosted shares of other homebuilders. Insurance companies gained on a published report that said the U.S. Treasury will let certain insurers receive aid from its Troubled Asset Relief Program (TARP). The Dow Jones industrial average rose 47.55, or 0.6 percent, to 7,837.11. Alcoa shares rose slightly despite the aluminum maker reporting a bigger-than-expected quarterly loss. The broader Standard & Poor's 500 index rose 9.61, or 1.2 percent, to 825.16. The technology-heavy Nasdaq composite index rose 29.05, or 1.9 percent, to 1,590.66. The New York Stock Exchange composite index rose 55.74 to 5,176.41. The American Stock Exchange composite index rose 9.80 to 1,387.53. And the Russell 2000 index rose 10.42 to 442.12.
