Stocks surged this morning, with the Dow shooting up more than 400 points within minutes of the open, and steadying just under that, as investors celebrated new rules clamping down on short selling and the government’s hotly anticipated plan to buy bad debt from banks. The S&P and Nasdaq leapt 3% and 4.9% respectively. The US’ remaining independent brokerages surged, with Morgan Stanley gaining 33% and Goldman Sachs up 27%.
The SEC’s move to ban short-selling on financial shares “appears to be providing the long-awaited tonic to the crisis,” said one analyst group. The market enthusiasm mirrored similar surges in markets around the world, with benchmarks in the UK and China showing their biggest gains on record.