Dow climbs 117

Nasdaq up 28

Investors seem willing `to buy the dips' again

September 05, 2002|By BLOOMBERG NEWS

NEW YORK - U.S. stocks rose yesterday, sending the Dow Jones industrial average and Standard & Poor's 500 index higher for the first day in six. Microsoft Corp., Pfizer Inc. and Citigroup Inc. led the gain.

"We've seen a bit of change in the tenor of the market," said John Bartlett, who helps oversee $10 billion at Commerce Trust Co. in St. Louis. "We've seen, for the first time in a while, a willingness to come in and buy the dips, rather than just selling the rallies."

The Dow climbed 117.07, or 1.4 percent, to 8,425.12; the Nasdaq composite index advanced 28.47, or 2.3 percent, to 1,292.31; and the S&P 500 added 15.38, or 1.8 percent, to 893.40.

Russell 2000 up 10.62

Elsewhere on the broad market, the Russell 2000 index, a benchmark of small-cap stocks, rose 10.62 to 389.75, and the Wilshire 5000 total market index jumped 147.57 to 8,464.89.

The Sun-Bloomberg index of the top stocks in Maryland gained 3.30 to 181.76.

About 1.34 billion shares changed hands on the New York Stock Exchange, less than the average 1.4 billion shares this year.

More than two stocks rose for every one that fell on the Big Board. Three advanced for every two that declined on the Nasdaq stock market.

Boost Indexes, which veered between gains and losses in the morning, got a lift in the afternoon as General Motors Corp., Ford Motor Co. and Daimler- Chrysler AG said U.S. auto sales rose in August.

Earnings rise 0.9%

Earnings of S&P 500 companies rose 0.9 percent in the second quarter, ending a string of five quarters of falling profits, according to Thomson First Call.

Even though "we haven't seen a rebound in capital spending, that usually comes six to nine months after profits turn, and profits have turned," said Charles White, who manages $2 billion at Avatar Associates.

White has been buying shares of companies including Amgen Inc., Pfizer and Bank One Corp. He has reduced his cash position to 10 percent of assets from 40 percent in July.

Microsoft rose $1.19 to $48.21. Pfizer, the largest drugmaker, advanced $1 to $32.28. Citigroup, the largest financial services company, climbed 91 cents to $30.30, recouping some of its $3.36 Tuesday loss.

Article boosts Merrill

Merrill Lynch & Co. rose $1.49 to $35.67 after a German newspaper, Boersen-Zeitung, reported that UBS AG is considering buying the brokerage. Both UBS and Merrill Lynch denied the report.

Auto sales climbed 18 percent at General Motors, 12 percent at second-ranked Ford and 24 percent at Chrysler, the third- largest U.S. automaker.

General Motors gained 20 cents to $45.75; U.S. shares of DaimlerChrysler rose $1.65 to $41.52; and Ford gained 11 cents to $11.05.

Aquila Inc. rose 39 cents to $4.17. The utility owner had its corporate credit rating cut to BBB-, the lowest investment-grade rating, by Standard & Poor's. The ratings company said it isn't considering another cut.

LSI Logic Corp. advanced 74 cents to $7.70. The maker of custom semiconductors said it expects sales next year to rise about 20 percent as the chip industry emerges from its worst slump ever.

Philip Morris Cos. fell $1.71 to $47.80 and was the biggest drag on the Dow and S&P. The world's largest cigarette company is losing market share to cheaper competition, said the head of its U.S. unit.

Cigna Corp. dropped $2.65 to $80. The third-largest U.S. health insurer expects costs of $720 million this quarter to make up for investments that have declined in value. Standard & Poor's said it may cut Cigna's credit rating.

Hershey Foods Corp. slid $3.09 to $72.51. A state judge ruled that a planned sale of the company must be approved by the court, backing a claim by Pennsylvania officials that any sale would cause "irreparable harm" to the candymaker's home community.

Incyte Genomics Inc. tumbled $1.23, or 22 percent, to $4.40 after the company said its 2002 loss will be wider than forecast as fewer customers subscribe to the company's database.

Overseas, Japan's Nikkei stock average fell 1.5 percent; France's CAC-40 rose 1.4 percent; Britain's FTSE 100 slipped 0.04 percent; and Germany's DAX index gained 0.8 percent.

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