All financial markets are closed Thursday for New Year's Day.

The Dow Jones industrial average (INDU) rose 1.3%. The Standard & Poor's 500 (SPX) index gained 1.4% and the Nasdaq composite (COMP) rose 1.7%.

For investors, 2008 has been the worst year since the 1930s. The Dow lost 33.8%, the S&P 500 38.5% and the Nasdaq 40.5%. (For details, click here).

Amid the housing market collapse, credit crunch, recession and consumer spending slowdown, stocks plunged. Oil prices tumbled 61%, reversing the upward trend of the previous few years, as the global economy slowed. Bond prices rallied, as investors sought the comparative safety of government debt, despite piddling returns on their money.

"If history is any guide, individuals will at some point realize that to see attractive returns, they need to get back into stocks," said John Wilson, chief technical strategist at Morgan Keegan

Wilson and other analysts are cautiously optimistic that Wall Street will recover some in 2009, despite continued stock volatility and the ongoing recession. (Full story)

"Looking out, there's a little optimism about next year that could push us higher through the inauguration," said Ryan Detrick, chief technical strategist at Schaeffer's Investment Research. "But beyond that, we are still going to be dealing with the same problems that got us here in the first place."

Wall Street surged Tuesday after the government said it will pour $6 billion into GMAC Financial Services, the financing arm of struggling automaker General Motors (GM, Fortune 500). On Wednesday, GMAC said it had raised $21.2 billion in a debt-for-capital swap in its continuing efforts to build up capital. Last week, the Federal Reserve granted GMAC's application to become a bank holding company.

Trading was light heading into the new year.

Market breadth was positive. On the New York Stock Exchange, winners topped losers by over five to one on volume of 1.31 billion shares. On the Nasdaq, advancers beat decliners three to one on volume of 1.61 billion shares.

Labor market: The number of Americans filing new claims for unemployment saw a surprisingly large drop last week, the biggest in 16 years, due largely to the Christmas holiday and other seasonal factors. The number of Americans continuing to receive unemployment benefits surged, however. (Full story)

Bonds: Treasury prices plunged, raising the corresponding yield on the benchmark 10-year note to 2.21% from 2.08% Monday. Treasury prices and yields move in opposite direction. Yields on the 2-year, 10-year and 30-year Treasurys all hit record lows last week.

Lending rates were mixed. The 3-month Libor rate slipped to a 4-1/2 year low of 1.42% Wednesday, down from 1.44% Tuesday, according to Bloomberg. Libor is a key bank lending rate.

Other markets: In global trading, Asian markets ended higher and European markets gained in afternoon trading.

The dollar fell against the euro and yen.

U.S. light crude oil for February delivery rose $1.82 to $40.85 a barrel on the New York Mercantile Exchange. Prices had been lower ahead of the release of the weekly oil inventories report, which showed a surprise rise in crude supplies and a smaller-than-expected rise in gasoline stockpiles.

COMEX gold for February delivery rose $14.30 to settle at $884.30 an ounce.

Gasoline prices rose 0.1 cent to a national average of $1.617 a gallon, according to a survey of credit-card swipes released Wednesday by motorist group AAA.

2008 market meltdown: The S&P declined nearly 38.5% - its worst yearly performance since an earlier version of the broad stock index lost 47% in 1931. That version had 90 U.S. stocks in it.

For the Nasdaq, this year's loss of 40.5% is the tech-fueled index's worst ever, going back to its inception in 1971.

All 10 of the economic sectors, as measured by Standard & Poor's, posted substantial losses this year. The worst performer was financials, which lost 58%. The so-called "best" performer was consumer staples, which lost 18%.

Only two of the 30 components that make up the Dow Jones industrial average ended the year higher. Wal-Mart Stores (WMT, Fortune 500) rose nearly 17%, while McDonald's (MCD, Fortune 500) rose over 5%. The Dow's biggest loser was GM, down 87% this year, followed by Citigroup (C, Fortune 500), which lost 77%.

On Wednesday, Citigroup said its top executives won't take bonuses, after the bank's incredibly difficult year.

Of the Nasdaq 100 companies, seven gained -- led by biotechs Vertex Pharmaceuticals (VRTX) and Amgen (AMGN, Fortune 500). The Nasdaq 100's biggest losers were Focus Media Holdings (FMCN) and Liberty Media Interactive (LINTA).

Of the S&P 500 stocks, 22 ended the year with gains. Consumer-staple companies led the group. Family Dollar Stores (FDO, Fortune 500) was the biggest gainer, rising 34%. The S&P 500's biggest loser was AIG (AIG, Fortune 500), which lost 96%. (Full story) 

At 7:20 a.m. ET, Nasdaq, S&P and Dow Jones futures were all higher.

The government announced late Monday that it will pump $6 billion into GMAC Financial Services, a financing company critical to the survival of General Motors (GM, Fortune 500). (Full story)

The move deepens the federal government's bailout of the troubled auto industry. Less than two weeks ago, President Bush announced a $17.4 billion rescue package to prevent the collapses of GM and privately held Chrysler LLC.

Shares of GM rose 11% in Frankfurt trading. Ford Motor Co. (F, Fortune 500), which is not receiving bailout funds but is also struggling in the economic slump, rose nearly 10%.

Consumer confidence: The Conference Board is set to release its December index of consumer confidence at 10 a.m. ET. Economists surveyed by Briefing.com expected to rise to a reading of 45.2 from 44.9 in November. That would still be at the low end of the index on a historic basis, which reached an all-time low of 38.3 in October.

Also on Tuesday, a survey of purchasing managers in the Chicago area is expected to reveal further declines in manufacturing activity in a report scheduled for a 9:45 a.m. ET release.

IndyMac sale pending: Investors also await word on a sale of one of the nation's largest failed banks.

IndyMac Bank, which was taken over by the Federal Deposit Insurance Corp. after it collapsed in July under the weight of risky mortgages, is set to be bought by a group of private equity and hedge fund firms, according to a source familiar with the situation. The FDIC has said it expects a deal to be announced by year-end.

Markets: Tuesday's session was expected to be lightly traded, with many market participants on vacation, celebrating the year-end holidays. The markets will be closed Thursday for New Year's Day.

Stocks fell Monday as tensions in Gaza sent oil soaring more than 6%. Markets also reacted negatively to the news that Dow Chemical (DOW, Fortune 500) failed to close a major deal with Kuwait's state-run petrochemical company, raising doubts about Dow's ability to repay some $13 billion in debt it will take on once its acquisition of rival Rohm & Haas (ROH, Fortune 500) closes early next year.

European markets were higher in morning trading, led by a 1.7% gain in the German DAX. Asian stocks ended mixed, with Tokyo's Nikkei index finishing the trading year with a gain of 1.3%.

Despite Tuesday's moderate gain, the Nikkei ended the year down 42.9% - the worst year ever for the 58-year old Japanese benchmark index. The previous low had been 1990, when the Nikkei fell 38.7% amid a staggering housing-market decline.

Oil slipped 66 cents to $39.36 a barrel in electronic trading.

NEW YORK (CNNMoney.com) -- Stocks were mixed Monday morning as investors returned for the final few trading days of 2008.

The Dow Jones industrial average (INDU) and the broader Standard & Poor's 500 (SPX) index were both up a few points shortly after the opening bell. The Nasdaq composite (COMP) was down a few points.

Stocks drifted higher Friday in a thinly traded session, but all three major indexes are down sharply for the year.

The Dow is down nearly 36% versus last year. The S&P 500 has tumbled 40.5% and the Nasdaq is off 42% year to date.

Monday's session was expected to be quiet, with many market participants on the sidelines celebrating the year-end holidays. The markets will be closed Thursday for New Year's Day.

In Europe, markets reopened after an extended Christmas break, with London up more than 2%, Frankfurt up nearly 2%, and Paris up nearly 1% in morning trading. Asian markets ended mostly higher, with Tokyo's Nikkei index up 0.1%.

Oil rose amid concerns about the Middle East following Israel's military action against Hamas in the Gaza Strip. Crude futures rose $1.31 to $39.02 a barrel.

The financial sector was in focus early Monday amid reports that a consortium of private equity and hedge fund firms is close to a deal to buy the assets of failed mortgage lender IndyMac. The company's bank unit was seized by the government in July in one of the largest bank failures in U.S. history.

In corporate news, two of the nation's top automakers, General Motors (GM, Fortune 500) and Chrysler, will take possession of the first part of the $13.4 billion in emergency loans from the government.

Kuwait decided Sunday to scrap a deal to form a $17.4 billion petrochemical joint venture with Dow Chemical (DOW, Fortune 500). The decision is a big blow to Dow, which had hoped to use some of the proceeds to repay some of the $13 billion in debt it's assuming in the acquisition of Rohm & Haas, due to be completed in 2009.

Other markets: The dollar fell versus the euro and the yen.

COMEX gold for February delivery was up $5.4 to $876.60 an ounce.

Gasoline prices fell 0.8 cent to a national average of $1.619 a gallon, according to a survey of credit-card swipes released Monday by motorist group AAA.

The Dow Jones industrial average (INDU) was up 0.5% according to early tallies. The broader Standard & Poor's 500 (SPX) index advanced 0.8%. The Nasdaq composite (COMP) was down 0.3%.

U.S. markets were closed Thursday for the Christmas holiday.

On Wednesday, however, stocks managed modest gains in an abbreviated session as investors mulled reports on unemployment, manufacturing activity and consumer spending.

Oil and gold prices rose. U.S. Treasury debt also advanced while the dollar lost ground against the euro and the yen.

Trading has been subdued all week with many market participants on vacation. In addition to low participation, many investors have closed their books for the year and are not planning to take new positions until 2009.

With so many fund managers out of pocket, the market is experiencing "an influx of no interest," said Hugh Johnson, chairman of Johnson Illington Advisors, an Albany, N.Y.-based firm with nearly $700 million in assets under management.

Still, investors are "trying to size up what the retail season has been like," Johnson said. "While it's still hard to say, from everything I've seen, sales looks pretty dismal," he added.

Weak retail sales - particularly during the holiday season when most retailers earn the bulk of their income - are a major concern for investors since retail sales constitute two-thirds of the nation's overall economic activity.

Holiday sales: The first post-Christmas report on the holiday shopping period from Nov. 1 to Dec. 24 was not promising, with a report from MasterCard Worldwide unit SpendingPulse showing sales excluding gasoline down as much as 4% compared to last year.

The report called 2008 "one of the most challenging holiday shopping seasons in decades." The weak national economy was primarily to blame, with bad weather throughout the nation during the final week adding to the disappointment.

SpendingPulse said the apparel, electronics and luxury sectors were especially hard-hit this season.

The figures were significantly lower than the 2.2% rise in retail sales that the National Retail Federation, the world's largest retail trade association, had forecast.

GMAC: The Federal Reserve on Wednesday approved GMAC's request to become a bank holding company.

The move paves the way for General Motors' troubled finance unit to gain access to much needed federal bailout money. GMAC's exposure to illiquid mortgage-backed securities was a major threat to the automaker, which is already on the verge of collapse due to weak sales and tight credit.

Earlier this month, the Bush Administration said it will extend $13.4 billion in emergency loans for GM and Chrysler to help keep the companies out of bankruptcy.

Shares of GM (GM, Fortune 500) were up nearly 13%.

Other markets: In global trading, Asian markets were mixed, with Japan's Nikkei advancing 1.6% and the KOSPI index in South Korea falling nearly 1%. Hong Kong was closed for the holiday. European stock exchanges were also closed.

The dollar fell versus the euro and rallied against the yen.

U.S. light crude oil for February delivery was rose $2.36 to settle at $37.71 a barrel in New York.

COMEX gold for February delivery was down $23.20 to $871.20 an ounce.

Gasoline prices fell overnight to a national average of $1.642 from $1.655 a gallon, according to a survey of credit-card swipes released Monday by motorist group AAA.