Wall St: Wednesday close

By GRAEME BEATON
Updated:

 

WALL Street rallied toward the close as high techs helped make the first trading day of the New Year a winning one.

The Dow Jones Industrial Average, which closed out 2001 down 7.1%, re-bounded from a 50-point loss at one point to finish higher by 51.90 points or 0.52% to 10,073.40. The Nasdaq Index, which lost 20% last year, was the stronger of the two markets all day to close up 28.85 points or 1.48% to 1,979.25.

But analysts said the late-day rally did not indicate a trend. 'It's more just a little bit of a bounce - reinvestment for the beginning of the year,' said James Volk, co-director of institutional trading at investment firm D.A. Davidson & Co. 'There's no real reason for these markets to rally at this point.' Art Cashin, of UBS PaineWebber, said that fund managers could hold back until they see key US economic data later this week. 'The employment report due out on Friday gives people a clear excuse to sit on their wallets and do nothing until then,' he said.

The monthly jobless report, due out before the open of exchange trading on Friday, often serves as as a market-moving event partly because of the headline impact it has on consumer confidence, an important factor in an economy where two-thirds of activity is based on personal spending. Figures out from the Institute of Supply Management (formerly the National Association of Purchasing Management) showed manufacturing strengthening for the second straight month. The Institute's index rose to 48.2 in December from 44.5 in November, topping expectations.

Techs strengthened after a South Korean semiconductor vendor posted higher prices for memory chips for the third time in a month. The development, which industry watchers said could indicate pricing power returning to chip makers, helped semiconductor shares with Intel rising $1.55 or 4.9% to $33. Intel's rivals were also on the plus side, with Texas Instruments up 82 cents or 3% to $28.82,Micron ahead $2.24 or 7.2% to $32.24, and Atmel marked up 56 cents or 7.6% to $7.93.

Microsoft recovered some of its New Year's eve decline, gaining 79 cents or 1.2% to $67.04. Oracle added 17 cents or 1.2% to $13.98. Cisco Systems moved up $1.12 or 6.2% to $19.23. Hewlett-Packard, which has been under pressure in the face of opposition to its proposed merger with Compaq Computer stood out with a rise of $1.11 or 5.4% to $21.65. Compaq re-bounded 72 cents or 7.4% to $10.88.

Broker comments moved a slew of issues. Adolph Coors, which announced it was buying Carling a week ago, slid another 44 cents or 0.8% to $52.96 on an analyst's downgrade. Shares in Coors have fallen more than 10% since announcing the Carling deal. K-Mart, the US retail chain, lost 72 cents or 13.2% to $4.74 on negative broker comments following a disappointing holiday shopping season. AT&T rose 56 cents or 3% to $18.70 as Merrill Lynch had positive words to say about the telecom giant. Bioengineering company Monsanto tumbled $1 or 3% to $32.80 on published allegations that it had dumped chemicals into a creek in Alabama. Biotech ImClone dipped another $3.13 or 6.7% to $43.33 after authorities delayed introduction of a key cancer drug.

Among Dow components, Walt Disney recovered 73 cents or 3.5% to $21.45, General Electric gained 87 cents or 2.2% to $40.95 and Johnson & Johnson lost 40 cents or 0.7% to $58.70.

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