Issue link: https://www.epageflip.net/i/44879
8B Daily News – Monday, October 17, 2011 NEW YORK (AP) — it's within 2011 was shaping up to be a washout for the stock market just two weeks ago. Now, shouting distance of its biggest comeback in near- ly three decades. The Standard and Poor's 500 index has jumped 11.4 percent since hitting its lowest level of the year on Oct. 3, largely because investors have become more confident that Europe will shelter its A year-end stock comeback? It's happened before Wall Street banks from huge losses on Greek bonds should that country's government stop making payments on its debt. For much of the sum- mer, investors feared that a Greek default could lead to a freeze of lending between European banks and cascade into a credit crisis similar to the one in 2008. The S&P 500 was down 12.6 percent for the year as of Oct. 3, when it closed at 1,099. As of Fri- day, it had trimmed the loss to 2.6 percent. It needs to gain just 33 points, or 2.8 percent, to get above 1,257, where it started the year. If the S&P 500 finishes the year with a gain, it will be the biggest turnaround since 1984. That year, Apple Inc. introduced the Macintosh, and President Ronald Reagan's cam- Attention Teachers of Tehama County Through a Child's Eyes This year pre-promoted and published as a stand- alone section Wednesday, November 30th, 2011 Deadline to enter your students: Thursday, October 19th An Entry Form and Contest Rules will be faxed to the Tehama County Schools by: Thursday, October 13th Please check your inboxes. For the students: 6 Cash Prizes for 1st (Grand Prize) & 2nd prize winners, will be awarded. Two in each of the 3 grade groups: • 2nd – 3rd Grades • 4th – 5th Grades • 6th, 7th & 8th Grades Contact Nadine Souza @ 527-2151 ext 132 if you have any questions. D NEWSAILY 527-2151 RED BLUFF TEHAMACOUNTY OC O C O S C nsouza@redbluffdailynews.com paign ads proclaimed that it was ''Morning Again in America.'' It was also the last time that the S&P 500 fell more than 10 percent during a calendar year and finished the year in the black. The index finished that year up 1.4 percent. Edging out another gain of that size in 2011 would- n't make anyone rich. But consider the hand that investors were dealt this year: A tsunami and nuclear disaster in Japan plunged the world's third- largest economy into a recession and created a worldwide parts shortage. Uprisings throughout the Arab world sent the price of gas skyrocketing to an average of $3.98 a gallon in May. The U.S. lost its top-notch credit ranking for the first time. And Europe has teetered on the edge of a financial crisis that could hobble the region's banking system. With all of that going on, investors might wonder how the S&P 500 index could possibly end the year higher than where it start- ed. The biggest reason: some think stocks may be the best value out there. With dividend pay- ments alone, the S&P index offers a return on par with low-risk U.S. Trea- surys. From Aug. 24 through Thursday, the yield on the 10-year Trea- sury note was below the dividend yield of the S&P 500 index. Since 1962, the only other time that's hap- pened was during the 2008 credit crisis, according to J.P. Morgan. ''You have to have pret- ty dark thoughts to think that there's not a chance that the S&P 500 beats out Treasurys at this point,'' said Bill Stone, chief investment strategist at PNC Bank. Stone also thinks com- pany earnings are going to be better in the third quar- ter than many analysts expect, driving stock prices higher. Since July, analysts have cut back their estimates for the S&P 500's third quarter earn- ings 3 percent because of concerns that the U.S. economy might be head- ing into a recession. Since then, retail sales, applica- tions for unemployment benefits, and the number of jobs added in August have been better than Wall Street expected. ''The market has been priced for the worst, but that's not bearing out in reality,'' Stone said. Others point to the fact that the S&P 500 was stuck in a narrow trading range since Aug. 4th. That day, the index fell below 1,260 during a broad sell- off. The stock market has moved up and down a lot since then, but hasn't real- ly gone that far. The S&P 500 has mainly traded between 1,099 and 1,218, a relatively small band. On Friday it broke out of that range, closing at 1,224.