Wall Street

By The Associated Press

NEW YORK (AP) – Wall Street staged a dramatic turnaround Friday, shooting higher in the last half-hour of trading after word that a bailout plan for troubled bond insurer Ambac Financial could be announced next week. The major indexes ended a week of choppy trading mixed.

CNBC reported shortly before the closing bell that a plan to help shore up the finances of Ambac Financial Group Inc. could be announced Monday or Tuesday. Ambac shares jumped on the report and finished up $1.48, or 16 percent, at $10.71.

The market’s turnaround came after nearly two full days of selling. The Dow Jones industrial average had been down nearly 130 points, but by the close, showed a 225-point reversal from its lows of the session.

“There’s probably some validity to the rumors,” said Jim Herrick, manager of equity trading at Baird & Co., referring to traders’speculation about Ambac. “With the overall financial crunch we’ve experienced, this brings new confidence in the sector.”

For the week, the Dow edged up 0.27 percent, while the S&P 500 rose 0.23 percent and the Nasdaq lost 0.79 percent.

The market’s early decline followed a sell-off Thursday that left the Dow down more than 140 points, or 1.15 percent.

(c) 2008 Telegraph – Herald (Dubuque). Provided by ProQuest Information and Learning. All rights Reserved.