By Chuck Mikolajczak
NEW YORK (Reuters) - Stocks rose on Friday after the U.S. government said it would throw a $17.4 billion lifeline to automakers grappling with falling consumer demand.
Stocks pared gains from an earlier 2 percent rise as investors digested terms of the bailout that give the automakers a relatively short period of time to repair problems facing the beleaguered industry.
"It's relief for the markets," said Tim Ghriskey, Chief Investment Officer of Solaris Asset Management in Bedford Hills, New York. "There was a feeling it was on its way, it is being dealt with and not in a way that opens up the pocketbook and says 'take what you need'."
Retailers capped the advance on the market, as the S&P Retailers Index <.RLX> fell 1.2 percent while heavy snow and inclement weather across large parts of the United States threatened to damage sales during the last weekend of what is expected to be a weak holiday shopping season.
Shares of General Motors Corp
The Dow Jones industrial average <.DJI> was up 56.63 points, or 0.66 percent, at 8,661.62. The Standard & Poor's 500 Index <.SPX> was up 9.44 points, or 1.07 percent, at 894.72. The Nasdaq Composite Index <.IXIC> was up 23.58 points, or 1.52 percent, at 1,575.95.
Investors had fretted wide-reaching ramifications of a potential failure of one of Detroit's big automakers. The government loans would be called back if they cannot restructure enough to ensure their survival.
However, shares of rival Ford Motor Corp
Oracle Corp Shares of BlackBerry maker Research in Motion surged over 12 percent to $43.12 on Nasdaq. In addition to posting better-than-expected third-quarter results after the close on Thursday, the company gave an optimistic outlook for its fourth-quarter. Oracle's stock also climbed 7.6 percent to $17.87, a day after reporting second-quarter earnings that were in line with estimates while posting a sales decline that was less than feared. But a drop in retailers' stocks, including Target Target's stock slid 1.7 percent to $34.81 and JC Penney lost 3.6 percent to $20.00, both on the New York Stock Exchange. (Editing by James Dalgleish)
