Dow Gains 60 as Week Ends Quietly

Exhausted traders Friday celebrated the end of one of Wall Street’s most volatile weeks with a modest rally, as Asian, Latin American and European markets appeared to stabilize after heavy recent losses.

The Dow Jones industrials gained 60.41 points to 7,442.08, paring the loss for the week to 273.33 points, or 3.5%.

Winners outnumbered losers by 2,093 to 896 on the New York Stock Exchange, and all major indexes closed higher, with most gaining 1% to 1.5% for the day.

NYSE volume continued to slow from Tuesday’s record 1.2-billion-share pace, as 638 million shares changed hands. For the week volume totaled a stunning 4.6 billion shares on the NYSE and also 4.6 billion on Nasdaq.

After Monday’s 554-point Dow dive and Tuesday’s 337-point recovery, analysts said the market’s emotions wound down as the week progressed. The Dow added 8 points Wednesday and fell 125 points Thursday.

Friday’s market pattern was similar to Wednesday’s and Thursday’s: Stocks rallied sharply early in the day, then fell back as sellers took advantage of higher prices to cash out. The Dow was up as much as 114 points before fading.

Still, some analysts were impressed with the market’s ability to avoid racking up more losses. It helped that Asian markets overnight closed modestly higher, with Tokyo’s Nikkei-225 index up 0.6% to 16,458.94 and Hong Kong’s Hang Seng index rising 2.5% to 10,623. They were helped by news of a financial bailout package for Indonesia.

Global markets’ plunge early in the week was triggered by worries that Hong Kong would be forced to follow the rest of struggling Southeast Asia and devalue its currency. Because of its major status among world markets, a devaluation by Hong Kong would have spread fears of global currency devaluations, plunging real estate values and sinking stock prices.

As it turned out, Hong Kong successfully maintained its dollar’s value for the week. But Hong Kong’s stock market still sank a net 4.7% for the week.

Meanwhile, currency-devaluation fears spread to Latin America on Thursday. Both the Brazilian real and the Mexican peso did lose value against the dollar for the week, with a dollar buying 8.37 pesos by Friday, up from 7.87 a week earlier.

But the real firmed on Friday, after Brazil hiked interest rates to defend it. That helped the Brazilian stock market gain 1.5% on Friday, after Thursday’s 9.8% plunge.

Also, Merrill Lynch upgraded Brazil’s market to the firm’s “top pick” for the next three months, predicting a rally.

On Wall Street, the bond market continued to provide a positive backdrop for stocks. The 30-year Treasury bond yield ended at 6.14% Friday, up slightly from 6.13% on Thursday but down from 6.27% a week earlier.

At the NYSE on Friday, Jiang Zemin, China’s president, rang the opening bell. He grinned broadly and shouted to the traders on the floor 20 feet below, “Good morning! I wish you good trading!”

Will “good trading” return to the battered market, with the Dow still down 10% from its August peak, and the Nasdaq index off 8.8% from its record high?

“Once you’ve taken a big knock, you don’t lose that fear overnight,” said Ronald J. Hill, investment strategist at Brown Bros. Harriman & Co. “It’s like a healing process. Once you get centered on the fact that the fundamentals remain positive, we would expect to see new highs in equities” by year’s end.

Among Friday’s highlights:

* The Dow was led higher by Chevron, up $2.69 to $82.95; IBM, up $2.69 to $98.50; and Disney, up $1.75 to $82.38.

* Bank stocks, hammered Thursday by Latin American loan concerns, revived. Wells Fargo added $3.13 to $291.38, BankBoston rose $1.38 to $81.06 and BankAmerica jumped $2.13 to $71.88.

* Many tech stocks rebounded. Compaq gained $2.75 to $64 and Dell jumped $2.13 to $80.13.

* Retailers remained popular, as investors sought issues that might gain from the predicted coming wave of cheaper Asian imports. J.C. Penney jumped $2.81 to $58.69 and Sears gained 81 cents to $41.88.

Market Roundup, D4