Business news for Thu, 29 Nov 2007 & with words financial+rate+slump. 2 news.

WALL Street barreled higher yesterday for the second day in a row, giving the Dow Jones industrial average its biggest two-day point gain in five years after a Federal Reserve official hinted that the central bank may lower interest rates again. Investors' renewed hopes for a rate cut added to their relief that companies that made losing bets on subprime mortgages, such as Citigroup Inc and Freddie Mac, are coming up with ways to raise cash. The market was clearly optimistic that at least some of the damage from the months-long credit crisis was finally being mitigated. However, Wall Street has been fickle in recent months, and no one is betting that the mortgage crisis that tripped up the nation's financial industry this year is over, or that the market's huge gains so far this week will stick. Despite its spectacular advance this week, the Dow remains more than 6 percent below its October 9 record close over 14,000, having plunged due to worries that the housing market's slump

A top Federal Reserve official yesterday acknowledged that a downturn in financial markets over the past months has increased the chances of a serious economic slump -- and the stock market soared, as investors took his words to mean that the central bank will cut a key interest rate further.