US Stocks open higher after steep sell-off

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(Agencies)
Updated: 2008-11-22 00:00

NEW YORK -- Wall Street experienced some relief early Friday following a report that a pounded-down Citigroup Inc. might put itself up for sale. That prospect, along with some bargain-hunting after two days of steep selling, sent stocks higher in early trading.

Trader Michael McCabe works on the floor of the New York Stock Exchange Thursday, Nov. 20, 2008. [Agencies]

The market's optimism about Citi and the financial sector overall came after The Wall Street Journal reported late Thursday that Citigroup is considering the possibility of selling parts of itself or even the entire company following a plunge in its stock price. The shares, which lost 26 percent Thursday alone, are down 84 percent for the year.

Beyond the banking sector, better-than-expected earnings from Dell Inc. offered some reassurance that profit-making is continuing even with consumers reluctant to spend. The computer maker reported a 5 percent drop in its fiscal third-quarter earnings and a 3 percent decline in revenue, but the profit came in well ahead of what Wall Street had expected. Dell rose 10 cents to $9.91.

In other corporate news, Wal-Mart Stores Inc. named Mike Duke, vice chairman of its international division, to replace Lee Scott as president and chief executive of the company when he retires in February. The stock added $1.47, or 2.9 percent, to $52.13.

A move higher in stocks wasn't necessarily a surprise given the scope of the selling in the past two days. Sharp market declines often attract investors searching for deals on beaten-down stocks. On Thursday, the Standard & Poor's 500 index fell 6.7 percent to its lowest close since April 1997, while the Dow Jones industrial average fell 445 points, or 5.6 percent, to its lowest finish since March 2003.

In the first hour of trading Friday, the Dow Jones industrial average rose 147.58, or 1.95 percent, to 7,669.87.

Broader stock indicators also rose. The Standard & Poor's 500 index rose 16.86, or 2.24 percent, to 769.30, and the Nasdaq composite index rose 30.75, or 2.34 percent, to 1,346.87.