The central bank expects slow improvement in the second half, while BlackRock takes a sunnier view.

Traders appear to believe that Wall Street will recover far sooner than the broader economy; placing value on predictions from BlackRock and a forecast for modest second-half improvement from the Federal Reserve.

The Fed issued minutes from its Dec. 16, monetary policy meeting Tuesday afternoon; predicting negative GDP growth in 2009 with accelerating unemployment into 2010. Despite the gloomy forecast, investors seized on the central bank's prediction that the beginnings of a slow recovery will emerge in the last two quarters of the year, and sent stocks shooting higher in afternoon trading before reining in the rally to finish with moderate gains.