US stocks rose today as more dismal economic news raised hopes that the Federal Reserve will aggressively cut interest rates and Congress will reduce taxes.
The Labour Department reported that the nation's jobless rate shot up to 4.5% in April, the highest level in two-and-a-half years. The figures also showed that businesses slashed their payrolls by the largest amount since the recession in 1991.
The Dow Jones industrial average fell as low as 10,673.61 before recovering up 154.59 at 10,951.24. The Nasdaq composite index was up 45.46 at 2,191.66 while the Standard & Poor's 500 index rose 18.03 to 1,266.61.
At the White House, meanwhile, press secretary Ari Fleischer said President George W Bush "remains very concerned about the strength of the economy".
He added that the Bush administration believed it was "entirely possible" that the government's recent 2% reading for the nation's first-quarter economic growth would be revised downward.
Stocks rose on expectations that the economic news will prompt the Fed to cut interest rates a half a percentage point when it meets on May 15. Earlier, the odds had been on a quarter-point cut.
Among stocks taking big hits were Wind River Systems Inc, with its shares dropping 66 cents to $25.52.
The company cut its first-quarter earnings projections to a range of 4 cents to 6 cents a share. It cited a significant slowdown in customer spending and said it will cut its work force by up to 15%.