It was rock and roll for US stocks last week, with the major stock indexes sharp drop in the beginning of the week then wiping out a week of shattering losses by end as Wall Street cheered the government’s moves to kick-start credit markets as well as plans to move against short sellers.

The major stock indexes had climbed above the level at which they stood before the start of the watershed week, which saw the Dow Jones Industrial Average lose about 800 points in the first three days of trading.

The Dow Jones Industrial Average rose 368.75 points to end at 11,388.44, a lapse of 0.3% from a week ago. The S&P 500 Index gained 48.56 points to finish at 1,255.07, a weekly gain of 0.3%, leaving up 0.3% from last Friday’s close. The Nasdaq Composite Index jumped 74.80 points to end at 2,273.9, giving it a 0.6% rise for the week.

The US Treasury and Federal Reserve have gone all out to rescue the financial sector, but it’s the details that will determine whether their massive bailout plan will recharge the markets and economy.

The markets will be focusing on how the rescue package is taking shape in Washington this week. The highlight will be the testimonies from Fed Chairman Ben Bernanke on Tuesday and Treasury Secretary Hank Paulson, who appear before the Senate Banking Committee and House Financial Services Committee on Thursday.

Under the plan, the government would take the toxic debts from the balance sheets of financial institutions, expand purchases of mortgage debt, and insure money market funds. The SEC has also moved in to stop short selling in financial companies’ shares temporarily.

Traders can expect a roller coaster ride in the markets again this week, as more details of the package is reviewed. The Dow, after a series of triple digit, sharp turning moves, finished the week down just 33.55 points at 11,388. The S&P 500 was up just 3 at 1255. Its 9.4% move higher Thursday and Friday was the biggest two day gain since October, 1987.

“Your ultimate success or failure will depend on your ability to ignore the worries of the world long enough to allow your investments to succeed. It isn’t the head but the stomach that determines the fate of the stock-picker” - Peter Lynch

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