The Dow leapt almost 400 points today, the best kickoff to a second quarter since 1938. Lehman Brothers and UBS announced plans to raise capital, cheering investors and convincing many that big banks can work through the credit crisis, Bloomberg reports. The Dow ended up 391.47 at 12,654.36, the Nasdaq 83.65 at 2,362.75, and the S&P 500 47.48 at 1,370.18.
"It looks like a financial-led rally, some of it based on Lehman raising capital," one strategist told MarketWatch. "The thought being if you can raise the capital and take care of things, it takes off the table the collapse worries." "The market's getting a little more comfortable that the crisis is over,'' said a fund manager. "It's a rally associated with the presumed elimination of survival risk.''