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Stocks rebound on home prices

Feb. 06, 2013 @ 12:00 AM

NEW YORK -- The stock market bounced back Tuesday following a surge in U.S. home prices and signs of recovery in Europe's economy. Strong earnings reports also helped power the gains.

The Dow Jones industrial average ended the day 99.22 points higher at 13,979.30, erasing a large part of its loss from Monday. The index traded above 14,000 during the day before falling back in the last hour.

The Standard & Poor's 500 gained 15.59 points to 1,511.29. The Nasdaq composite was up 40.41 points to 3,171.58.

The rise follows two days of whiplash. On Monday, the Dow dropped 129 points, its worst sell-off of the year so far, as fears about Europe's finances resurfaced. On Friday, the index gained 149 points, closing above 14,000 for the first time since 2007. The Dow is now 185 points below the record high of 14,164 it reached on Oct. 9, 2007.

After strong gains for stocks this year, investors are wondering whether they should sell now, or wait and see if the rally still has legs, said Brad Reynolds, chief investment officer at LJPR, Inc.

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