FINANCIAL MARKETS : Dow Hits Another Peak; Tech Shares Bounce Back
U.S. stocks rose, driving the Dow Jones industrial average up 7.23 points to 5,048.84, its third straight record. The Dow had closed Wednesday at 5,041.61. Computer, semiconductor and software shares rebounded from a four-day slump.
But activity on Wall Street was so slow that traders were reluctant to draw many conclusions from the day’s activities.
“It’s a typical after-Thanksgiving market,” said Eugene Peroni, a technical analyst at Janney Montgomery Scott in Philadelphia. “There’s extremely low volume, but a good day in terms of the rally, mostly in the Dow.”
Advancing issues had a weak 7-6 lead on decliners on the New York Stock Exchange. Volume was very light at 125.87 million shares, far below Wednesday’s pace.
Peroni said the near-equal division between up and down stocks reflects skepticism, which, in the contrarian world of Wall Street, “could be short-term bullish.” But, he added that investors may be counting too much on lower interest rates. If an easing “doesn’t happen, investors may be disappointed,” Peroni said.
“In terms of volume, today was nothing,” said Peter Cardillo, director of research at Westfalia Investments. “Some tech stocks rebounded nicely, but I would be cautious at these levels. The market is setting itself up for a correction.”
Virtually all major U.S. stock indexes rose. Stocks got a little lift from bonds and the dollar, and from the traditional optimism that usually holds sway around Thanksgiving.
The 30-year Treasury bond yield fell to 6.24%. The dollar rose against the Japanese yen and German mark.
Meanwhile, Mexican stock prices closed with their seventh consecutive gain Friday after a high-volume session in which investors shrugged off a new scandal involving the family of former president Carlos Salinas Gortari. The Bolsa index was up 5.44 points, or 0.21%, to 2,575.99.
Among the market highlights:
* Technology stocks, which have been volatile lately, made some gains. On the Big Board, IBM rose 5/8 to 95 7/8, Micron Technology rose 1 5/8 to 49 3/8 and Motorola gained 2 1/8 to 62. In Nasdaq trading, Intel added 1 1/8 to 63, Sun Microsystems gained 1 3/4 to 79 1/2 and Cisco Systems climbed 3 to 78 3/4.
* System Software led in Nasdaq volume and dropped 4 5/8 to 32 7/8, after reports of a battle with Owens-Illinois over allegations of product failure.
* Consumer-related stocks, which did poorly in the beginning of the week, were mixed. The Dow was led higher by Procter & Gamble, a consumer stalwart, which added 1 1/4 to 86 1/2. But Philip Morris lost 5/8 to 89.
In overseas trading, the Nikkei-225 index in Tokyo fell 0.13%. But European stocks rose, with the FTSE-100 in London up 0.60%, the CAC in Paris up 1.28% and the DAX in Frankfurt up 0.27%.
Wheat prices rallied to a one-month high on a strong lineup of exports and concern about dry weather in the Great Plains. Commodity markets in Chicago closed early, and New York commodity exchanges remained shuttered the day after Thanksgiving.
The wheat market, which peaked Oct. 20 at a 14-year high of nearly $5.09 a bushel, rose above the $5 mark for the first time in a month.
The Agriculture Department reported that U.S. wheat exports during the week ended Nov. 16 totaled 837,000 metric tons, 65% higher than for the previous week.
