Traders begin to work shortly after the opening bell at the New York Stock Exchange. (AP Photo)

Dow Ends Up 45, Nasdaq Up 7

December 14, 2001, 04:45 PM

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By Amy Baldwin, AP Staff

NEW YORK —- Attracted to Wall Street by cheaper prices, investors on Friday again set aside nagging pessimism about the economy and indulged in some late-session buying.

The market retraced its moderate losses and turned positive by late afternoon, a move that analysts deemed encouraging especially on a Friday when investors often sell to reduce risk going into the weekend.

"The fact is that (being) down in the morning and up in the afternoon tends to be a bullish indicator," said Scott Bleier, chief investment strategist at Prime Charter Ltd.

The Dow Jones industrial average finished up 44.70, or 0.5 percent, at 9,811.15 after falling as much as 29 earlier. The Dow's performance mirrored that of Wednesday, when the blue chip index turned positive in the last 30 minutes of trading to eke out a 6-point gain.

The broader market followed the same path as the Dow, another repeat of Wednesday's trading. The Nasdaq composite index rose 6.66, or 0.3 percent, to 1,953.17, and the Standard & Poor's 500 index advanced 3.69, or 0.3 percent, to 1,123.07.

The market, which had been expecting some pullback following weeks of strong rallies, welcomed the late-day advance.

"Money managers want to buy ... and many missed the run from late September," said Bleier, in a reference to how the market indexes have rebounded from the lows of Sept. 21 when the Dow slid to 8,235.81.

Lukewarm economic data likely kept the market from moving up sooner in Friday's session, because investors are anxiously awaiting concrete proof that a recovery is under way.

The Labor Department said its closely watched Consumer Price Index showed no change last month after falling 0.3 percent in October as America's first recession in a decade continued to hold down inflation.

Also, the Federal Reserve said output at the country's factories, mines and utilities was down 0.3 percent last month, the 13th decline in the past 14 months.

But Friday and Wednesday aside, the market fell this past week amid a spate of layoffs from such companies as American Express and Aetna and profit warnings from Ciena, Lucent Technologies, Merck and Bristol-Myers Squibb. The litany of bad news reminded investors that economic weakness will carry over into 2002, pushing back the rebound they're anxiously awaiting.

The Dow did not had a close above 10,000 this past week, after crossing that milestone last week for the first time since before the Sept. 11 terror attacks. Having suffered triple-digit selloffs Monday and Thursday, the Dow ended the week down 2.4 percent.

The Nasdaq had a weekly loss of 3.4 percent; the S&P 500, 3.0 percent.

"We've lost the euphoria we had," said Todd Clark, co-head of trading at WR Hambrecht.

Wall Street's gains on Friday ended up being spread across an array of sectors. Companies that benefitted the most were those that offered positive prospects.

McDonald's, which reaffirmed fourth-quarter earnings estimates, rose $1.16 to $26.80. Retailer Circuit City soared nearly 10 percent, up $2.16 at $24.16, following an upgrade by Banc of America.

Among the stocks investors sold were companies that posted disappointing earnings or indicated that business remains difficult.

Oracle slipped 10 cents to $14.57 on news that sales of new software licenses plunged 27 percent during the quarter ending Nov. 30, and that profits slid 12 percent as sales of its business software shriveled.

Gannett fell 75 cents to $65.20 after the country's largest newspaper publisher said it was canceling next year's raises for about 80 of its top executives, following the lead of other major publishers struggling with a difficult business climate for newspapers.

Advancing issues outnumbered decliners slightly more than 17 to 13 on the New York Stock Exchange. Consolidated volume totaled 1.6 billion shares, below Thursday's 1.9 billion.

The Russell 2000 index, which tracks smaller company stocks, rose 2.62, or 0.6 percent, to 471.29. The Russell ended the week down 2.1 percent.

Overseas, Japan's Nikkei stock average rose 0.8 percent. In Europe, Germany's DAX index fell 1.1 percent, Britain's FT-SE 100 dropped 0.3 percent, and France's CAC-40 declined 1.6 percent.

(Copyright 2001 by The Associated Press. All Rights Reserved.)