Features

NEW YORK — Enticed by bargain prices and heartened by the possibility of a tax cut, investors did some tentative buying Friday, limiting most of their purchases to safer blue chips. 

Comments by Federal Reserve Chairman Alan Greenspan, who told Congress he favors income tax cuts to reduce federal budget surpluses, helped boost some stocks. Still, another set of profit warnings, including one from software maker Oracle, reminded the market it could be some time before earnings and the economy show signs of substantial improvement. Analysts didn’t expect any of Friday’s gains to last and they described investors as cautious.  

“Until investors have more confidence that we are not going to get blindsided every day by a new wave of companies giving us bad news, the tone of the market will stay as it is – guarded at best,” said Hugh Johnson, chief investment officer for First Albany Corp.  

Defensive stocks – called that because they fare better in a bear market – accounted for much of the Dow’s advance. Philip Morris climbed $1.15 to $49.70, while Procter & Gamble rose $1 to $69.65.. 

Analysts saw hope in the fact that some tech stocks moved higher while others recovered some of the steep losses they incurred on profit warnings from big-name companies like Oracle. 

— The Associated Press 

“People were worried that we might get another leg down in the Nasdaq, because of yet another warning from one of the glamour tech stocks, and that just didn’t happen,” said Richard A. Dickson, a technical analyst at Scott & Stringfellow in Richmond, Va. 

Software maker Oracle, which issued a profit warning late Thursday, fell nearly 21 percent, down $4.50 at $16.88. 

Tech stocks’ mixed day came from investors being torn between the lure of lower prices and fear generated by earnings warnings, Dickson said. 

While investors are afraid the Nasdaq is going to keep sliding, Dickson said, they’re also thinking, “What if these thing have hit the bottom and I missed the boat?” 

Advancing issues outnumbered decliners about 5 to 4 on the New York Stock Exchange. Consolidated volume was 1.48 billion shares, down slightly from 1.51 billion on Thursday. 

The Russell 2000 index gained 3.58 to close at 476.88. 

Overseas markets were mostly lower. Japan’s Nikkei stock average fell 3.3 percent, Britain’s FT-SE 100 lost 0.8 percent, and France’s CAC-40 declined 0.9 percent. But Germany’s DAX index gained 0.6 percent