April stocks a ray of hope

NEW YORK - April was Wall Street's best month in nine years - offering some of the most powerful evidence yet that maybe, just maybe, the economy is about to turn around.

The Standard & Poor's 500 index, considered the most reliable measure of the broader market, climbed 9.4 percent in April, its best performance since March 2000, the peak of the dot-com bubble. The Dow Jones industrial average shot up 7.4 percent in April, on top of a 7.7 percent gain in March.

That is more than a relief for investors - it is a potential economic indicator, because the stock market tends to get back on its feet before the economy does.

Yesterday, the Dow Jones industrial average fell 17.61 points, or 0.22 percent, to 8,168.12. The Standard & Poor's 500 index fell 0.83, or 0.10 percent, to 872.81, while the Nasdaq composite index rose 5.36, or 0.31 percent, to 1,717.30.

Stocks mostly held steady yesterday, the same day that Chrysler L.L.C. filed for bankruptcy reorganization. Only two months ago, a more jittery market would have plunged if one of the Big Three had said it could not pay its bills.

On paper at least, U.S. stocks gained nearly $1 trillion in value in April alone.

The hope among many investors and policymakers is that Wall Street itself will help the larger economy along. The same psychology that led many people to cut spending after last fall's frightening stock plunge could work in reverse, boosting confidence in the economy and making Americans more comfortable about spending.

The Dow's biggest loser yesterday was JPMorgan Chase & Co., a Chrysler bondholder. General Motors Corp., another troubled automaker and a Dow component, finished higher despite the Chrysler news.

Another Dow component that lost ground yesterday was Exxon Mobil Corp. The oil company's first-quarter profit fell 58 percent from a year earlier to the lowest level in more than five years.

The Chicago Purchasing Managers' index jumped to 40.1 in April from 31.4 in March. The index is considered a precursor to the Institute for Supply Management's manufacturing index, which is due today.

The government said initial claims for jobless benefits fell last week by 14,000, to 631,000. Economists had predicted an increase. Continuing jobless claims jumped to a record, however, and the government also reported a slightly larger-than-expected decline in personal spending and incomes.