Market cuts losses on home loan news

Published: 12 Feb 2009 22:03:54 PST

NEW YORK, Feb 12 - U.S. stocks sharply cut losses on Thursday, with the Nasdaq swinging back into positive territory, following a Reuters report that the Obama administration was hammering out a program to subsidize mortgage payments for troubled homeowners.

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* Earlier both the Dow and the S&P 500 had slid by as much as 3 percent, while the Nasdaq dropped 2 percent.

* But heading toward the market close the market had recouped lost ground significantly, with the Dow Jones industrial average <.DJI> off 54.71 points, or 0.69 percent, at 7,884.82. The Standard & Poor's 500 Index <.SPX> was down 4.25 points, or 0.51 percent, at 829.49. The Nasdaq Composite Index <.IXIC> was up 2.80 points, or 0.18 percent, at 1,533.30.