Bouncing stocks post so-so gain

NEW YORK — Wall Street closed only moderately higher in an erratic session Wednesday as investors remained unconvinced by a Federal Reserve plan to work with other central banks to alleviate the global credit crisis.

The Dow Jones industrial average closed up 41.13 at 13,473.90 after soaring as much as 271.75 in early trading and then plunging by as much as 111 points.

Microsoft, one of the 30 Dow stocks, closed 37 cents higher at $34.47 a share. Boeing, also a Dow stock, fell $1.78 to $86.92.

Broader stock indicators climbed. The Standard & Poor's 500 index rose 8.94 to 1,486.59. The Nasdaq composite index rose 18.79 to 2,671.14.

Investors erased the spike that followed the Fed's announcement of an agreement with the European Central Bank and the central banks of England, Canada and Switzerland to confront what it called elevated pressures in the credit markets.

"There's still no certainty that we're out of the woods ... there's still a risk for recession," said Steven Goldman, chief market strategist at Weeden & Co. "We did get very positive news from the Fed and other banks chipping in to add liquidity into the system. But, the environment hasn't fundamentally changed that the worst is over for the financial system."

He pointed out that the biggest beneficiaries during a period of rate cuts are bank and brokerage stocks. However, the sector was under pressure Wednesday as investors worried the institutions will take further writedowns after warnings from Bank of America, Wachovia and PNC Financial Services.

Tuesday's stock plunge of 294 points had interrupted Wall Street's attempt at an end-of-the-year rally, but Wednesday's performance brought the possibility of a market recovery back to the table. The Dow is up more than 6 percent since falling as low as 12,724.09 Nov. 26.

Energy prices soared after the government reported surprising declines in U.S. stockpiles of crude oil and surged even further after reports of a fire at an ExxonMobil refinery in Texas. A barrel of light sweet crude jumped $4.37 to $94.39 a barrel on the New York Mercantile Exchange.