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U.S. stocks rally as bond insurers' ratings are affirmed - International Herald Tribune

U.S. stocks rallied Monday after Standard & Poor's affirmed its ratings for Ambac Financial Group and MBIA, raising hopes that troubled bond insurers will emerge from the credit market crisis on solid footing. The Dow Jones industrials rose more than 100 points.

"This is essentially evidence that S&P has signed off any tentative deal," said Charlie Smith, chief investment officer at Fort Pitt Capital Group.

Chris Johnson, president of Johnson Research Group, said the market continued to look for any sign that financial stocks would make it through the credit crisis. Experts believe keeping bond insurers whole will spare greater losses for major global banks and brokerages.

"Even the smallest bit of positive news and the market takes off," he said. "Investors get excited if they sense a bottom in the financials because they've been the Achilles' heel of this market."

"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Tue Feb 26th, 2008 at 01:18:10 PM EST

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