U.S. stocks gained for a second day, trimming losses at the end of the market’s worst year since the Great Depression, as fewer Americans filed for jobless benefits and the Treasury said it will expand aid to the car industry.

The S&P 500 rose 1.4 percent to 903.25, paring this year’s tumble to 38.5 percent. The Dow Jones Industrial Average added 108 points to 8,776.39, down 34 percent in 2008.

Jobless Claims

All 10 of the main industry groups in the S&P 500 advanced after the Labor Department said new jobless claims were depressed by the shortened holiday workweek even as the total number of people collecting benefits reached a 26-year high. Benchmark indexes jumped to their highs of the day after the Treasury said it drafted broad guidelines to rescue any company deemed important to making or financing cars.

At its lowest closing level of 2008 on Nov. 20, the S&P 500 was down 49 percent for the year and 52 percent from its Oct. 9, 2007, record of 1,565.15. The plunge came as more than $1 trillion in credit-related losses at financial companies globally dragged the U.S., Europe and Japan into the first simultaneous recessions since World War II.

The S&P 500 has rebounded 20 percent since its 11-year low on Nov. 20. The gains came as the government rescued Citigroup Inc., President-elect Barack Obama pledged to stimulate growth with spending on infrastructure projects and the Federal Reserve cut interest rates to as low as zero to combat the worst financial crisis in seven decades.

2008 Declines

Financial companies tumbled the most among the 10 main industries in the S&P 500 this year, falling 57 percent collectively for the worst drop in the 19-year history of the index tracking the group. The retreat was driven by banks racking up asset writedowns and credit losses stemming from the 2007 collapse of the subprime-mortgage market.

Lehman Brothers Holdings Inc., once the nation’s fourth- biggest securities firm, filed the largest U.S. bankruptcy in September after its shares lost almost all their value. Merrill Lynch & Co. and Bear Stearns Cos., Lehman’s rivals, were forced into emergency takeovers to avoid collapse, while Goldman Sachs Group Inc. and Morgan Stanley converted to bank holding companies as investors lost confidence in firms that depend on debt-market financing. Morgan Stanley shares slid 70 percent in 2008, while Goldman Sachs fell 61 percent.

Automakers slumped as the slowing economy pushed General Motors Corp. to the brink of bankruptcy, sending the nation’s largest car company down 87 percent and prompting the government to issue emergency loans to keep the company solvent. GM’s U.S. sales tumbled 22 percent during the first 11 months of the year, which the company blamed in part on buyers’ dwindling access to credit.

The S&P 500’s decline in 2008 was the first that exceeded 30 percent since the 39 percent plunge in 1937. The benchmark gauge for U.S. equities lost 23 percent in 2002 and 29.7 percent in 1974, losses that were followed by annual gains of 26 percent and 32 percent, respectively.