* Fed announcement spurs volatile session
* VIX rises, then falls after Fed news
* Indexes up: Dow 0.2 pct, S&P 0.4 pct, Nasdaq 0.3 pct
* For up-to-the-minute market news see []
(Updates to close)
By Ryan Vlastelica
NEW YORK, Nov 3 (Reuters) - U.S. stocks ended a volatile
session modestly higher on Wednesday after the Federal Reserve
detailed a plan to breathe new life into the struggling
economy.
Both the Dow and Nasdaq closed at levels not seen since
2008 while the S&P ended at a six-month high. The gains were
preceded by an erratic session in which equities zigzagged up
and down as the Fed announced a plan to buy $600 billion in
Treasuries. The size of the plan was greater than had been
anticipated but less than many hoped. For details, see
[]
"The question is whether this is enough. The consensus was
$500 billion over the next six months or so. This is just a
little bit ahead," said Jeff Kleintop, chief market strategist
at LPL Financial, Boston.
The S&P has risen about 14 percent since the start of
September as investors bet on the Fed's action and Republican
gains in Tuesday's elections, two suppositions that came to
pass and ended some of the market's uncertainty.
The CBOE Volatility index <.VIX>, a favored gauge of
investor anxiety, fell 9 percent after rising earlier. The
change in direction "indicates... that traders feel the Fed
support under the market remains firm and that we are likely to
see higher highs in the stock benchmarks," said Jon Najarian, a
co-founder of web information site Optionmonster.com in
Chicago.
The Dow Jones industrial average <> was up 26.41
points, or 0.24 percent, at 11,215.13. The Standard & Poor's
500 Index <.SPX> was up 4.39 points, or 0.37 percent, at
1,197.96. The Nasdaq Composite Index <> was up 6.75
points, or 0.27 percent, at 2,540.27.
The Nasdaq ended at its highest since June 2008 while the
Dow closed at its highest since September 2008. The S&P 500
closed at its best level in six months.
The S&P 500 broke through its 200-week moving average,
which was seen signaling further gains.
The Republicans' strong gains in the election, including
regaining control of the House and increasing their numbers in
the Senate, would be more business friendly, investors said.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For stories on the U.S. elections: []
For a graphic on the election results:
http://link.reuters.com/wav53q
For a special report on Fed quantitative easing:
http://link.reuters.com/pyb23q
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In company news, both Aetna Inc <AET.N> and WellPoint Inc
<WLP.N> rose after posting higher-than-expected quarterly
earnings and raising their full-year profit views. Aetna rose
2.9 percent to $30.48 while WellPoint was up 0.5 percent to
$56.05. []
But Time Warner Inc <TWX.N> fell 1 percent to $32.07 after
the media company reported its third-quarter results.
[]
Housing stocks also fell after PulteGroup Inc <PHM.N>
posted an adjusted third-quarter loss that widened from the
prior year. The stock lost 7.7 percent to $7.45.
[]
In economic news, the U.S. services sector grew more
quickly than expected in October and factory orders posted
their largest gain in eight months. A separate report showed
U.S. private employers added more jobs than expected in
October. []
Volume was light, with about 6.92 billion shares traded on
the New York Stock Exchange, the American Stock Exchange and
Nasdaq, below the year-to-date daily average of 8.73 billion.
About eight stocks rose for every seven that fell on the
New York Stock Exchange, while on the Nasdaq, about seven
stocks rose for every six that fell.
(Reporting by Ryan Vlastelica; Additional reporting by Doris
Frankel; Editing by Kenneth Barry)
