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NEW YORK — After falling in the early going on disappointing jobs data, the Dow Jones industrials ended Wednesday with a gain following reports showing a rebound in pending home sales and improving manufacturing activity. Other major indexes rose about 1.5 percent.
Financial stocks led the market higher, followed by big gains in technology and energy shares. As sentiment about the economy improves, investors have been buying up industries they believe are likely to lead the country out of recession.
Better economic data and an improving outlook on U.S. banks in recent weeks has fueled optimism that the recession could end this year. But there are still a number of analysts who warn against calling a bottom to the market too soon.
“People seem to swing from one side to the other of ‘the recovery has started’ to ‘the world is ending again,’ ” said Bill Stone, chief investment strategist at PNC Wealth Management.
On Wednesday, more positive economic data helped feed the rally.
Pending home sales rebounded in February from a record low, the National Association of Realtors reported, while the Institute for Supply Management’s index of manufacturing activity contracted in March but by a bit less than anticipated.
Construction spending dropped in February for the fifth straight month, but at a slower pace than in January.
“It’s hard to call it good data in a normal environment but it certainly looks like some of the … housing activity has at least stabilized,” said Stephen Massocca, managing director at Wedbush, Morgan Securities.