US STOCKS-Wall St ends higher as S&P view eases credit fears

                                
 (Updates to close)
                                
 By Justin Grant
                                
 NEW YORK, March 13 (Reuters) - U.S. stocks rallied on
Thursday after a major credit rating agency said the end to
subprime-related write-downs is in sight, triggering a rebound
in financial shares.
                                
 Standard & Poor's said write-downs for large financial
institutions are likely past the halfway mark, soothing
investors' anxiety about the latest credit market fallout and
increasing the allure of riskier assets.
                                
 Standouts in the financial sector included shares of U.S.
home finance companies Fannie Mae <FNM.N>, up more than 9
percent, and Freddie Mac <FRE.N>, up more than 7 percent.
                                
 A Dow Jones index of home builders' shares <.DJUSHB>
gained 5.9 percent after Rep. Barney Frank, chairman of a U.S.
House Financial Services Committee, unveiled a mortgage
bailout plan aimed at distressed borrowers who are grappling
with declining home values.
                                
 In a sign that investors were willing to take on more
risk, demand for safe-haven U.S. Treasury bonds fell sharply
after an auction of 10-year government notes drew weak
bidding.
                                
"My gut is that the whole (turnaround) sort of started when
that S&P story came out and said they see the end of
write-downs for major financial institutions. That seems to
have been what turned the market around today," said Todd
Clark, managing director of stock trading at Nollenberger
Capital Partners in San Francisco.
                                
 The Dow Jones industrial average <.DJI> gained 35.50
points, or 0.29 percent, to 12,145.74. The Standard & Poor's
500 Index <.SPX> increased 6.71 points, or 0.51 percent, to
1,315.48. The Nasdaq Composite Index <.IXIC> rose 19.74
points, or 0.88 percent, to 2,263.61.
                                
 Freddie Mac jumped 7.6 percent to $21.30, while Fannie
Mae's shares climbed 9.2 percent to $22.97.
                                
 A slight pullback in oil prices from Thursday's record
high of $111 a barrel improved investors' sentiment along with
a slight recovery in the dollar.
                                
 "A lot of these markets seem to be linked lately. I'm
seeing the dollar strengthen, crude weaken, equities are doing
better and bonds are selling off," Clark said.
                                
 Shares of Exxon Mobil <XOM.N> rose 1.3 percent to $87.05.
                                
 Thursday's trading was volatile. All three indexes -- at
session lows -- were down about 2 percent and up about 1
percent at session highs.
                                
 At the open, stocks tumbled after an unexpected plunge in
February U.S. retail sales fueled concerns about a
consumer-led recession and a fund affiliated with Carlyle
Group -- Carlyle Capital Group <CARC.AS> -- said lenders were
likely to seize its assets after it defaulted on about $16.6
billion of debt.
                                
 Trading was active on the New York Stock Exchange, with
about 1.8 billion shares changing hands, below last year's
estimated daily average of roughly 1.9 billion, while on
Nasdaq, about 2.47 billion shares traded, above last year's
daily average of 2.17 billion.
                                
 Advancing stocks outnumbered declining ones on the NYSE by
about 18 to 13 and by about 3 to 2 on the Nasdaq.
  (Additional reporting by Ellis Mnyandu; Editing by Jan
Paschal)