Market Watch

The Associated Press
Tuesday March 06, 2001

NEW YORK — Stocks moved higher Monday as investors took advantage of cheaper prices and momentarily put aside their fears about the slowing economy. 

Wall Street managed the advance despite warnings from more companies that future profits will be weak. Analysts are split over whether that means the market is poised to rally or whether investors are just temporarily bargain hunting. 

The Dow Jones industrial average rose 95.99 to close at 10,562.30, according to preliminary calculations. Volume was the lightest so far this year as many traders stayed home due to the winter storm in the Northeast. 

overcame downgrades of 15 stocks including Altera by Prudential Securities, which believes the shares will bottom out in the second or third quarter. 

As companies defy bad news, the chances of a longer-lasting market rally increase, said Arthur Hogan, chief market analyst for Jefferies & Co. 

“We have finally come to the point where we have a price-news divergence meaning stocks don’t go down on bad news,” Hogan said. “That is typical of a (market) bottom.” 

Not all stocks, however, were able to shake off bad news. Coca-Cola, the Dow’s biggest loser on Monday, tumbled $2.35 to $50.20 after the company announced a management reorganization plan that included the elimination of the president’s post. 

Still, a bit of optimism about the economy could be seen in other blue chip dealings. Investors bid down the safer stocks like drug issues after months of running them up when riskier tech sectors fell out of favor.  

Meanwhile, the market sent more economically sensitive blue chips higher. Consumer cyclical stocks, called by that name because they suffer when the economy slows down, led the Dow’s move up.  

— The Associated Press 



General Motors gained $1.08 at $55.38. 

However, some analysts don’t expect prices to keep going higher. They say investors are still cautious and call market advances “trading rallies” spurred only by cheaper prices. The consensus on Wall Street is that selloffs will continue to be the dominant trading pattern as the market faces more bad news about earnings and how much the economy has weakened. 

“It’s a rally in the Dow and in (consumer) cyclicals. That’s about it though,” said Gary Kaltbaum, a technical analyst for First Union Securities. “I don’t count it as much as anything. Volume is light because of the snowstorm.” 

Advancing issues outnumbered decliners slightly more than 8 to 7 on the New York Stock Exchange. Monday’s trading was the year’s lightest to date with volume of 921.46 million shares, well below 1.02 billion on Friday. The last time volume dipped below 1 billion shares was Dec. 26. 

The Russell 2000 index, which tracks the performance of smaller company stocks, fell 1.09 to 475.79. 

Stocks also rose overseas, boosting Japan’s Nikkei stock average by 0.5 percent. In Europe, Britain’s FT-SE 100 gained 1.2 percent, France’s CAC-40 rose 1.5 percent, and Germany’s DAX index advanced 0.9 percent. 


On the Net: 

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

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