Stocks turn lower amid Spanish bailout hope

By NBC News wire services

Updated at 4:00 p.m. ET: Stocks gave up an initial rally and moved mostly lower Tuesday, amid speculation Spain will soon request a bailout, seen by some as the necessary next step to alleviating the euro zone's debt crisis.

In a positive sign, Spain's borrowing costs moderated. Spanish 10-year bond yields fell below 5.76 percent after trading above 6 percent for at least part of the past four sessions.

"I think the market feels that we are closer to some type of action and resolution in terms of the Spanish problem," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont. "That's certainly helping markets this morning."

But uncertainty is still a worry for investors. In spite of Spain's apparent readiness to ask for help, Germany has signaled that it should hold off on its request, according to European officials on Monday.

Chrysler said September vehicle sales were up 12 percent from a year earlier and the highest for the month since 2007.

JPMorgan Chase & Co was sued by New York's attorney general on Monday in the first action to come out of a working group created by President Barack Obama to go after wrongdoing that led to the financial crisis. The civil fraud lawsuit centered on mortgage-backed securities packaged and sold by Bear Stearns, which JP Morgan acquired.

Reuters contributed to this report.

Source: http://marketday.nbcnews.com/_news/2012/10/02/14181926-stocks-higher-on-spanish-bailout-hopes?lite

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