Stocks Rebound From Steep Drop As S&P Forecasts End Is Near for Asset Write-Downs

The S&P projection gave investors some hope that the seemingly unrelenting losses from the mortage and credit crisis might indeed be bottoming out. Standard & Poor's Ratings Services said it estimates writedowns of subprime asset-backed securities could reach $285 billion globally, up from its previous projection of $265 billion, but added that "the end of write-downs is now in sight for large financial institutions."
Wall Street clearly remains anxious, however. On Tuesday, the stock market launched its largest rally in more than five years after the Federal Reserve said it would auction $200 billion in Treasurys to help alleviate investment banks' financial bind. But since then, stocks have been extremely volatile
The S&P's note arrived on the heels of a spate of troubling news. A Carlyle Group fund warned late Wednesday it expects creditors will seize all the fund's remaining assets after unsuccessful negotiations to prevent its liquidation. Meanwhile, the government reported Thursday an unexpected dip in retail sales, and a research firm said nearly 60 percent more U.S. homes faced foreclosure in February than in the same month last year.
The Dow Jones industrial average finished up 35.50, or 0.29 percent, at 12,145.74, after being down more than 220 points early in the session and then popping up more than 100.