Stock market rebounds again

The stock market rebounded Tuesday from Monday’s sharp decline, sending the Dow Jones industrials up 270 points. All the major indexes rose more than 3%.

Investors wary about the economy drew solace from Ford Motor Chief Executive Alan Mulally, who said the automaker had enough cash to survive through 2009 and might not need government help.

Rival General Motors said late in the day that it needed $12 billion in government loans to continue operating; the news briefly shook the market, but stocks rebounded before the close.

Ford shares rose 15 cents to $2.70. GM rose 26 cents to $4.85.

The market was also encouraged after General Electric said it expected to pay a dividend despite projections that fourth-quarter results would near the low end of its previous forecast range. That raised hopes that U.S. companies might fare better during the recession than feared. GE shares shot up 14%.

A Standard & Poor’s index of financial stocks, the hardest-hit sector this year, led the way up Tuesday with a 7.9% gain after the Federal Reserve extended the life of key programs aimed at loosening the credit markets. Bank of America jumped 12%, while JPMorgan Chase rose 9.2%.

The Dow rose 270 points, or 3.3%, to 8,419.09, making back more than a third of Monday’s plunge, which snapped a five-day rally.

Broader stock indexes also surged Tuesday. The Standard & Poor’s 500 index rose 32.60 points, or 4%, to 848.81, while the Nasdaq composite index gained 51.73 points, or 3.70%, to 1,449.80.

The Russell 2,000 index of smaller companies rose 5.9%.

Advancing issues outpaced decliners 3 to 1 on the New York Stock Exchange.

Other market highlights:

* Goldman Sachs Group fell 76 cents to $65 after the Wall Street Journal reported the firm could record $2 billion in losses in the fiscal fourth quarter.

* The dollar fell against other major currencies. Gold prices rose.

* Oil futures slumped $2.32 to $46.96 a barrel on the New York Mercantile Exchange.

* Overseas, key stock indexes rose 1.4% in Britain, 3.1% in Germany and 2.4% in France. Shares in Japan slumped 6.4%.