NEW YORK – U.S. stocks rose in early trading today, marking a possible end to six straight days of declines. The rebound follows a day in which the U.K. bank bailout and multinational interest-rate cut combined with forecasts of a longer, deeper recession to create one of the most volatile trading days on record.

Yesterday’s swings added 7.2 percent to the Chicago Board Options Exchange’s Volatility Index, boosting it to a record 57.53, Bloomberg News reported, and by day’s end, five stocks had fallen for every two that rose on the New York Stock Exchange.

The major indexes all lost ground: The 30-stock Dow Jones Industrial Average ended the day down 189.01 points, or 2 percent, at 9,258.1; the Standard & Poor’s 500 Index fell 11.29 points, or 1.1 percent, to a five-year low of 984.94, after swinging from gain to loss at least 20 times during the day; and the Nasdaq Composite Index dipped 0.8 percent to close at 1,740.33 points.

Banking and financial services companies were among the big losers, dragged down in part by earnings expectations: A recent survey of economists by Bloomberg News calls for U.S. companies to post third-quarter profits 5.6 percent below their year-ago levels, while financial companies see a 64-percent average decline.

The 84-company S&P 500 Financials Index – up by as much as 3.9 percent earlier in the day after the Federal Reserve and other central banks joined in announcing their multi-national rate-cut (READ MORE) – fell to close down 3 percent, at an 11-year low.

The most active stock in New York trading yesterday was Bank of America Corp. (NYSE: BAC): roughly 322.7 million shares changed hands yesterday, more than three times its average volume over the past three months.

BofA extended Tuesday’s 26-percent loss, falling $1.67, or 7 percent, to close at $22.10. Weighing down its price were the company’s sale yesterday of $10 billion in stock – 455 million shares, at $22 apiece, an 8 percent discount from the previous day’s close – and its report of a 68-percent decline in third-quarter profit. The bank, which recently halved its dividend in another capital-boosting move, is seeking to buy Merrill Lynch & Co.

“The recession is going to be a little deeper than we thought,” BofA’s CEO Kenneth Lewis told a conference call last week, according to Bloomberg News. “It’s going to take some more time and some more pain.”

Among other financial companies with Rhode Island operations, the results yesterday were mixed, with local banks faring better overall than their larger competitors:

Bancorp Rhode Island Inc. (Nasdaq: BARI), the parent of Bank Rhode Island, ended down 41 cents, or 1.5 percent, at $26.17.

Independent Bank Corp. (Nasdaq: INDB), parent of the Bay State’s Rockland Trust Co., closed down $1.24, or 4.5 percent, at $26.49.

Sovereign Bancorp Inc. (NYSE: SOV) closed down 23 cents, or 4.8 percent, at $4.54.

Wachovia Corp. (NYSE: WB) – whose lawyer David Boies has said a “grand solution” is being negotiated between rival bidders Citigroup Inc. and Wells Fargo & Co. – ended the day down 19 cents, or 3.7 percent, at $5.06.

Webster Financial Corp. (NYSE: WBS), Connecticut-based parent of Webster Bank N.A., closed down 52 cents, or 2.6 percent, at $19.46.

Yet Newport Bancorp Inc. (Nasdaq: NFSB), the holding company for Newport Federal Savings Bank, was unchanged at $12, in light volume of only 3,100 shares.

Washington Trust Bancorp Inc. (Nasdaq: WASH), parent of The Washington Trust Co., edged up 16 cents, or 0.8 percent, to $21.16

And Citizens Financial Group parent Royal Bank of Scotland (London Stock Exchange: RBS.L; NYSE: RBS:US) – boosted by news of the U.K. bank bailout scheme – ended the day up 36 cents, or 24.2 percent, at $1.85 per share in New York trading. Its Citizens Bank has been gaining rising local market share (READ MORE)

Meanwhile, MetLife Inc. (NYSE: MET), the nation’s largest insurer, whose home and auto division is based in Warwick, saw its shares fall 27 percent to close at $27. The drop – yesterday’s second-steepest in the S&P - was spurred by the announcement that MetLife plans to raise capital and cut jobs after seeing its third-quarter profit fall 48 percent, Bloomberg said.

And the ailing American International Group Inc. (NYSE: AIG) lost 32 cents, or 9.1 percent, to close at $3.19 per share.

U.S. policymakers are working quickly to implement the $700 bailout package approved last week, and they are prepared to do more, if needed, Treasury Secretary Henry M. Paulson Jr. told a news conference late yesterday in Washington, D.C. But, he warned, “patience is also needed, because the turmoil will not end quickly and significant challenges remain ahead.”

Information about U.S. monetary policy and the administration’s financial rescue programs is available from the Federal Reserve Board at www.FederalReserve.gov and the U.S. Treasury Department at www.treas.gov.