Dow, S&P; Snap Their 4-Week Losing Streak
Blue-chip stocks rose Friday on upbeat earnings from International Paper, but an FBI warning of possible attacks against U.S. financial institutions sucked wind out of the rally and left the broad market flat and high-tech issues down.
The damage ultimately was limited, much like Thursday when the market recovered from midday declines after an airplane crashed into a skyscraper in Milan, Italy.
By day’s end, major indexes had posted their first weekly gains in at least a month. Bonds were mixed, while gold prices fell and oil rose slightly.
The Dow Jones industrial average rose 51.83 points, or 0.5%, to 10,257.11. The Standard & Poor’s 500 index finished up less than a point, or 0.1%, at 1,125.17. The Nasdaq composite index reversed mild gains and fell 5.60 points, or 0.3%, to 1,796.83.
Winners led losers by 4 to 3 on the New York Stock Exchange, but losers outnumbered winners 8 to 7 on Nasdaq. Trading was moderate.
The Dow rose 0.7% for the week, while the S&P; 500 was up 1.3%, snapping four-week losing streaks for both indexes. The Nasdaq posted a weekly gain of 2.3%, ending a five-week skid.
Friday’s early rally, sparked by optimism over Microsoft’s latest results, faded as the telecom sector dampened the mood. Microsoft rose 83 cents to $57.20, but Qwest Communications fell 97 cents to $6.60 after issuing a profit warning.
SBC Communications fell $1.17 to $32.72, and BellSouth slid $1.33 to $31.37. WorldCom, down 35 cents to $5.98, and Verizon Communications, off 45 cents to $42, also got caught in the general nervousness about the telecom sector. The S&P; telecom services index lost 2.5%.
Dow member IP, the No. 1 U.S. forest products company, gained 84 cents to $42.17 after it posted a net profit for the first time in seven quarters on cost-cutting initiatives.
More than half of the 30 corporate icons in the blue-chip Dow Jones industrial average had reported their earnings by the close Friday. It’s been a mixed bag of earnings, and investors are scratching their heads.
“There’s a clear indication that earnings are insufficient to provide upside momentum,” said Henry Herrmann, chief investment officer at investment firm Waddell & Reed. “The market is still looking for something to take a cue from, and it’s yet to be revealed.”
In other market news:
* Adelphia Communications fell 78 cents to $6.28 after the cable-TV operator said it may be delisted from Nasdaq.
* Walt Disney was one of the Dow’s biggest gainers, rising 55 cents to $24.95. Goldman Sachs upgraded it to “trading buy” from “market perform,” citing a quicker-than-expected recovery in its theme park business and continuing signs of a pickup in the advertising market.
* Transmeta slumped nearly 15% after the low-power semiconductor designer reported a wider loss and said its chief financial officer resigned, the latest in a string of executive defections from the once highflying Silicon Valley start-up. Its shares fell 49 cents to $2.80.
Market Roundup, C4-5
