Market goes low, then rises

The search for the bottom continues as investors try to measure the recession

NEW YORK -- Wall Street rebounded Tuesday in another turbulent session, as investors rushed back into the market after the Standard & Poor's 500 index tested a 2003 low.

The market, which had been down four of the past five sessions, has been volatile amid worries about how long a recession might be. That's driven many retail investors to the sidelines, while big institutional traders such as hedge funds keep major stock indexes vacillating.

That was the case Tuesday as stocks rallied in the final hour of trading. At least some of the buying was because fund managers whose portfolios are tied to the S&P 500 had to find a replacement for Anheuser-Busch. The brewer was officially removed from trading at the market's close after its takeover by Belgium's InBev SA was completed.

Investors also used the market's big drop earlier in the session as chance to scoop up undervalued stocks. There was some encouragement about corporate earnings after Hewlett-Packard said fourth quarter and 2009 results will sail past Wall Street expectations.

But still underpinning the market were concerns that the economy has fallen into a recession that could be the worst downturn in more than two decades. A disappointing reading on wholesale prices and the housing market only confirmed this.

Analysts said the market continues to search for a much-elusive bottom and could yet again retest lows.

"We're going to need more strength from here for a period of time to develop a convincing story that the market has bottomed," said Alan Gayle, senior investment strategist at RidgeWorth Investments.

The Dow ended up 151.17, or 1.83 percent, to 8,424.75. The Standard & Poor's 500 index rose 0.98 percent to 859.12. The Nasdaq composite index added 0.98 percent to 1,483.27.

Analysts warned not to take Tuesday's gain as a sign the stock market is ready to stage a recovery. Many think the economy has fallen into a recession that could be the worst downturn in more than two decades.

"There is no enthusiasm on the buy side right now," said Joe Keetle, senior wealth manager at Dawson Wealth Management. "You got a little spurt of it today because Hewlett-Packard's earnings were good and their outlook was good."

HP vaulted $4.25, or 14.5 percent, to $33.59.

In Asian trading, Japan's Nikkei index fell 2.28 percent, and Hong Kong's Hang Seng Index fell 4.54 percent. In European trading, Britain's FTSE 100 rose 1.47 percent, Germany's DAX index rose 0.49 percent, and France's CAC-40 rose 1.11 percent.