Late rally helps markets recover most of day’s losses

A late recovery on Wall Street wiped out most of the stock market’s losses Thursday, leaving the Dow Jones industrial average down just 25 points.

The Dow had been down as much as 177 points but came back sharply in the last 20 minutes of trading.

Many insurance stocks fell sharply after the Supreme Court upheld most of President Obama’s health care law. The stocks of hospital operators rose. The ruling upheld the central provision of the law, a requirement that almost all Americans carry health insurance.

There were varying explanations for the late comeback on the stock market. European leaders were holding their first day of summit talks to address the region’s sluggish economic growth and collapse of investor confidence in the finances of weak countries like Greece and Portugal.

The Dow Jones industrial average ended down 24.75 points at 12,602.26. Other indexes also cut their losses. The Standard & Poor’s 500 index fell 2.91 points to end at 1,329.04 and the Nasdaq composite fell 25.83 points to 2,849.49. Both indexes had been down more earlier.

European Union leaders annouce growth measures

The 27 leaders of the European Union have agreed to devote (euro) 120 billion ($149 billion) for “immediate growth measures,” a top European official said late Thursday.

Herman Van Rompuy, president of the European Council, said the heads of state and government would continue their discussion of how to achieve financial stability into the evening.

Van Rompuy said half the money would come from increasing the lending capacity of the European Investment Bank by (euro) 60 billion, adding that “this money must flow across Europe, and at least to the most vulnerable countries” to help them grow out of the crisis.

The other (euro) 60 billion would come from existing EU development funds, Van Rompuy said. The total of (euro) 120 billion is not large in terms of the size of the economy of the European Union.

In addition, EU leaders announced that they would offer (euro) 5 billion in “project bonds” to fund investments in transport, sustainable energy and digital infrastructure.

JPMorgan Chase stock drops more than 2 percent

JPMorgan Chase stock declined more than 2 percent on Thursday, making it one of the worst-performing banks, after a published report said its loss on a bad trade could be far higher than the bank first estimated.

The New York Times, citing an internal report at the bank, reported the loss could reach $9 billion. JPMorgan’s initial estimate was $2 billion when it disclosed the trade in May, although CEO Jamie Dimon said then that the loss could grow.

JPMorgan Chase stock closed down 90 cents, or 2.4 percent, at $35.88. JPMorgan traded around $41 before the loss was disclosed and has closed as low as $31 since.

The Times story said the $9 billion figure reflected a worst-case estimate by the bank. But because the bank has sold the most volatile part of the traditing position, the loss could be $6 billion to $7 billion, The Times reported.

— From news service reports