Most U.S. stocks fell after careening between gains and losses, as investors rewarded JPMorgan Chase & Co. for its $2-a-share buyout of Bear Stearns Cos. and punished other banks on concern they are overvalued.

The Dow Jones Industrial Average recovered from a drop of 194 points to finish higher, led by JPMorgan’s biggest gain in almost two months. The Standard & Poor’s 500 Index dropped for a second day, sliding to within 2 percentage points of a bear market, as Lehman Brothers Holdings Inc. and Morgan Stanley tumbled. The S&P 500 lost 11.54, or 0.9 percent, to 1,276.6 after falling as much as 2.4 percent. The Dow, which swung between gains and losses at least 27 times, advanced 21.16, or 0.2 percent, to 11,972.25. The Nasdaq Composite Index decreased 35.48, or 1.6 percent, to 2,177.01. Almost four stocks fell for every one that rose on the New York Stock Exchange.

Treasuries rose and the three-month bill rate plunged to the lowest since the 1950s as the Federal Reserve cut the discount rate at an emergency weekend meeting and backed JPMorgan Chase & Co.’s deal to buy Bear Stearns Cos.