Mood Lightens on Wall St. as Rally Takes Hold

Despite economic gloom spreading along Main Street, things on Wall Street are perking up, the New York Times reports—enough that analysts see a glimmer of hope for a turnaround beginning this year. The stock market rebounded almost 11% in recent weeks, junk bonds and other risky securities are rallying.

Many are echoing the cautious optimism of  Treasury Secretary Henry Paulson, who told Bloomberg yesterday, “We are closer to the end of this problem than we are to the beginning.” Economists link the improvement to the Fed-brokered Bear-Stearns buyout. But as foreclosures increase and the job market keeps waning, “there are still plenty of downside risks,” says an analyst. (More stock market stories.)