Originally created 11/25/03

Stocks advance on dollar's rebound

NEW YORK -- The Nasdaq composite index notched its best advance in nearly five months Monday as a recovery in the dollar motivated investors to pick up shares following two weeks of declines.

The Dow Jones industrials climbed more than 110 points, their best gain in a month, while the Standard & Poor's 500 index had its strongest advance in nearly two months.

"The stronger dollar is helping out," said Peter Cardillo, president and chief strategist of Global Partner Securities Inc. "We had a rather sloppy week last week ... and traditionally the week of Thanksgiving is usually a positive week for stocks."

"With the dollar improving and a slew of economic numbers coming out later this week, I suspect the market is playing catch-up," he said.

The Nasdaq gained 53.26, or 2.8 percent, to 1,947.14, following a weekly loss of 1.9 percent. It was the largest advance since July 7, when the tech-focused average surged 57.25 points.

The Dow closed up 119.26, or 1.2 percent, at 9,747.79, having fallen 1.4 percent in the previous week. It was the biggest point-gain for the blue-chip average since Oct. 28, when the Dow rose 140.15.

And the S&P 500 index rose 16.80, or 1.6 percent, to 1,052.08 following a decline of 1.4 percent. It was the best gain since Oct. 1, when the average rose 22.25.

The market has fallen in recent weeks as investors grappled with fears about a weakening dollar and concerns that stock prices might be a bit high. Last week, the dollar slid to a new low against the euro, raising worries of dampened foreign investment in the United States.

On Monday, the euro was quoted at $1.1770, down from $1.1915 late Friday. The dollar was quoted at 109.43 Japanese yen, up from 108.80 yen late Friday.

Despite the market's recent drop, analysts say investors remain largely optimistic about the economy. Reports due out later this week on consumer confidence, gross domestic product, and personal income should also give investors stronger clues about the strength of the recovery, they said.

Larry Wachtel, market analyst at Wachovia Securities, characterized recent declines as a healthy consolidation after several months of gains. Now that the market has "corrected" some its excessive gains, stocks might be poised for their traditional holiday rally, he said.

"Now we're in good technical and fundamental shape," Wachtel said. "So logically speaking, we should have a year-end rally. Today's buying might be a harbinger of that."

Cardillo agreed, but added that terrorism continues to be the market's biggest potential pitfall. In the last week, stocks largely fell following four bombings in Turkey.

"The biggest concern is ... the talk of a possible further terrorist attack," he said. "That's caused an escalation in the fear factor."

Boston Scientific Corp. climbed $1.79 to $35.70 after Johnson & Johnson lost a court bid to keep the company's new stent off the market.

Delta Air Lines Inc. rose 82 cents to $12.25 after the company said Leo F. Mullin will retire Jan. 1 as chairman and chief executive. Gerald Grinstein, a 16-year member of the board, will replace Mullins as CEO; John F. Smith Jr. the presiding director of Delta's board, will become nonexecutive chairman.

Adobe Systems Inc. gained $2.04 to $41.40 after UBS raised the company's stock rating to "buy" from "neutral."

Losers included long-distance phone company AT&T Corp., which declined 20 cents to $19.80. On Monday, new rules took effect allowing consumers to switch their home phone numbers to their cell phones.

Advancing issues outnumbered decliners 3 to 1 on the New York Stock Exchange. Volume was light.

The Russell 2000 index, a barometer of smaller company stocks, rose 13.58, or 2.6 percent, to 539.51.

In Europe, France's CAC-40 rose 1.4 percent, Britain's FTSE 100 gained 1.5 percent and Germany's DAX index climbed 2.6 percent. Japan's financial markets were closed Monday for Labor Thanksgiving Day, a national holiday.

On the Net:

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com


Trending this week:


© 2018. All Rights Reserved.    | Contact Us