By Elizabeth Stanton Nov. 24 (Bloomberg) -- U.S. stocks climbed for a second day after the government said it will guarantee $306 billion of troubled Citigroup Inc. assets and Democratic lawmakers pledged to pass an economic stimulus package by January. Citigroup, which lost more than 60 percent of its market value last week, rebounded 56 percent after the Treasury Department also agreed to inject $20 billion into the bank. JPMorgan Chase & Co. added 7.5 percent and Bank of America Corp. rose 13 percent as the guarantee eased concern that a flight of depositors might destabilize Citigroup, which has $2 trillion of assets. Intel Corp. and Alcoa Inc. climbed after Senator Charles Schumer said the stimulus plan may approach $700 billion. The Standard & Poor’s 500 Index added 2 percent to 815.86 at 9:34 a.m. in New York, its first back-to-back gains this month. The Dow Jones Industrial Average climbed 120.59 points, or 1.5 percent, to 8,167.01. The Nasdaq Composite Index rose 1.9 percent to 1,411.09. Europe’s Dow Jones Stoxx 600 Index increased 4.7 percent, while the MSCI Asia Pacific Index slipped 0.5 percent. “Job one is to continue to repair the psychology of this market, and the bailout or the help for Citigroup is an important part of that puzzle,” James Dunigan, managing executive for investments at PNC Wealth Management in Philadelphia, said on Bloomberg Television. PNC Wealth Management oversees $63 billion. Citigroup Rallies The S&P 500 rallied 6.3 percent on Nov. 21, paring a third straight weekly decline, after President-elect Barack Obama picked New York Federal Reserve Bank chief Timothy Geithner as Treasury secretary. The index has tumbled 44 percent this year and closed at an 11-year low on Nov. 20 after almost $1 trillion of financial-company losses caused corporate profits to decrease for five straight quarters. Citigroup climbed $2.11 to $5.88 today. The cash injection from the Treasury adds to the $25 billion the company received last month under the Troubled Asset Relief Program. In return for the cash and guarantees, the government will get $27 billion of preferred shares paying an 8 percent dividend. The Treasury, Fed and Federal Deposit Insurance Corp. said in a joint statement that the move aims to bolster financial- market stability and help restore economic growth. ‘Main Focus’ “With Citigroup hanging in the low single digits, the market was calling for either a breakup or some kind of resolution,” said Jack Ablin, who helps manage about $60 billion as chief investment officer of Harris Private Bank in Chicago. “This is going to be the main focus of market activity. It should be good news.” Concern Citigroup may need a government rescue sent bank stocks down 24 percent last week, the steepest slide in at least 19 years. To contact the reporter on this story: Elizabeth Stanton in New York at estanton@bloomberg.net

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