Stocks Rally on Credit News

Stock rallied in a big way today after S&P maintained the high credit ratings of top bond insurers Ambac and MBIA. The rating agency called MBIA's success "a strong statement of management's ability to address the concerns relating to the capital adequacy of the company," the Wall Street Journal reports.The Dow was up 189.20 to 12,570.22, the Nasdaq 24.13 to 2,327.48, and the S&P 500 18.69 to 1,371.80.

Some strategists cautioned against too much optimism over the rating news. "For the most part, this improves market psychology," says a manager. "But we ultimately need to see the fundamentals change." Meanwhile, news of declining home sales didn't hit the market particularly hard because even worse had been expected. (More stock market stories.)