Wall St higher but growth fears remain.

Traders discuss the state of the market on the floor of the New York Stock Exchange. 

 US stocks closed higher today in a volatile session as continued concerns about global growth sapped some of the market's earlier gains. 


The Dow Jones Industrial Average rose 57.14 points, or 0.59 per cent, to 9743.62, snapping a seven-session losing streak. However, the measure lost much of its early gains; it had been up more than 170 points earlier in the session.
Microsoft was the Dow's top performer today with a jump of US55 cents, or 2.4 per cent, to $US23.82. Alcoa was also strong, up US21c, or 2.1 per cent, to $US10.21, and Bank of America climbed US22c, or 1.6 per cent, to $US14.06.
Limiting the gains, Home Depot dropped US42c, or 1.5 per cent, to $US27.34. Boeing was also weak, down US58c, or 0.9 per cent, to $US61.36, and American Express lost US21c, or 0.5 per cent, to $US39.21.
The Nasdaq Composite edged up 2.09 points, or 0.10 per cent, to 2093.88, snapping a five-day losing streak. The Standard & Poor's 500 index climbed 5.48 points, or 0.54 per cent, to 1028.06, ending a five-session losing run.
Traders characterised today's climb in stocks as a natural bounce off of last week's slump, although the gains were pared as investors continued to fret over the same concerns about the global economy that have weighed in recent weeks.
"The fundamental outlook is questionable and most of the government policies haven't been helpful in terms of solving the unemployment problem," said Derwood Chase, chairman and chief executive of Chase Investment Counsel. "They may have been helpful temporarily to automobiles or selling condos, but we've got a lot of serious problems."
He added: "Solving a problem which basically reflects federal and state governments and many, many individual consumers being too heavily in debt, many of us are very sceptical of solving that problem by the government encouraging people to take on more debt."
In the bond markets, prices of US Treasury securities rose today as worries over the economic outlook bolstered demand for safe assets.
Growing concern about the economy has fuelled strong demand for Treasuries in recent weeks and pushed down the benchmark 10-year note's yield below 3 per cent.
A report today from the Institute for Supply Management, which showed the non-manufacturing index slowed to 53.8 last month from 55.4 in May, added to the anxiety that an economic recovery could falter in coming months.
"I think coming out of the worst recession in a long time has people much more concerned that this is something more then a blip. Only time will tell," said Thomas Roth, executive director in the US government bond trading group at Mitsubishi UFJ Securities (USA) in New York.
"That is why Treasuries still provide value."
In late New York trading, the benchmark 10-year note was up 11/32 to yield 2.937 per cent and the 30-year bond was 30/32 higher to yield 3.891 per cent. Bond yields move inversely to their prices.
In a volatile session after the Independence Day holiday, bond prices briefly gave up gains in the morning session amid a rally in European and US stocks. The 10-year note's yield rose to as high as 2.997 per cent before fresh buyers returned. Buying gained traction later in the session as the US stockmarkets pared gains.
Tom di Galoma, head of US rates trading at Guggenheim Partners in New York, said the 10-year notes have relatively good value with their yield near 3 per cent given "all the talk of a double dip (in the economy) and deflation forces taken hold".
But some market participants cautioned that the recent rally in the Treasury market has already discounted a lot about the bearish sentiment on the economy and the market needs fresh news to push yields to much lower levels.
"The hurdle for higher bond prices will stay elevated now that everyone is cowering in the same foxhole," said William O'Donnell, head of US government bond strategy at RBS Securities.
He added that Treasuries need a "cleansing" correction now that trader sentiment is excessively bullish.
The 10-year note's yield, the benchmark for consumer and corporate borrowings, touched 2.878 per cent on July 1, the lowest level since April 2009. The yield dropped more than 80 basis points in the second quarter, fuelled by the euro zone's debt problems and a flurry of weak US data.
Worries about a weakening economy have raised speculation that the Federal Reserve will keep its key policy rate at a record low near zero for longer than many had thought. The two-year note's yield, among the most sensitive to changes in official rate policy, touched a record low of 0.582 per cent on June 29.
Partly reflecting market anxiety about the economy, investors in recent weeks have piled into long-dated Treasuries, driving down their yields and narrowing their yield spreads over short-dated Treasuries significantly. A narrowing yield spread is known as a flattening yield curve.
Today, the benchmark yield curve, the yield spread between the two-year and 10-year notes, was 232 basis points, down from 235 basis points on Friday. The curve touched 228.2 basis points on Thursday, its flattest since May 2009.
It has flattened from a record wide of 292.9 basis points in February.