Wall Street Ends Down Week on an Up Note
Stocks roared back Friday in a broad rally that lifted the Dow Jones industrial average to a triple-digit gain, as bargain hunters swooped in after four days of steep losses.
The Dow had tumbled a total of 467 points in the four sessions, including Thursday’s 168-point plunge fueled in part by fears of a possible Al Qaeda link to the Madrid train bombings.
Friday, however, the industrials soared 111 points as 28 of the index’s 30 members finished higher.
“I’m surprised at how broad-based this rally is, considering how bad Thursday’s market was,” said Shelly Meyers, portfolio manager at Pacific Global Investment Management Co. in Glendale.
“With these threats of terrorism,” Meyers added, “you would think traders might be a little nervous about holding stocks over the weekend. But every sector I’m looking at looks pretty green.”
With the Dow starting the day down 5.7% from its recent peak in mid-February, and the Nasdaq off 9.7% from this year’s high in late January, analysts said stock valuations had become a bit more attractive for those seeking buying opportunities.
The Dow climbed 111.70 points, or 1.1%, to end the day at 10,240.08. The broader Standard & Poor’s 500 index gained 13.79 points, or 1.3%, to 1,120.57. The technology-heavy Nasdaq composite surged 40.84 points, or 2.1%, to 1,984.73.
Winners outpaced losers by about 3 to 1 on both the New York Stock Exchange and Nasdaq. Volume was down from Thursday’s heavy level, however.
The benchmark S&P; 500 wrapped up only its third losing week in the last 16, dropping 3.1%.
The Dow lost 3.4% on the week and the Nasdaq slid 3.1%.
Some strategists said this week’s sell-off had gotten overdone, especially after Thursday’s late swoon, setting the stage for Friday’s snap-back.
“There were two or three days there where you could count on your hands and toes the number of stocks that went up,” said Don Hodges, manager of the Hodges Fund in Dallas. “After a week like that, often you will get a reversal on Friday.”
The turnaround came despite mildly disappointing economic news.
Consumer confidence dipped in early March, according to the University of Michigan’s monthly survey. The survey index fell to 94.1 from 94.4 in February, coming in shy of expectations that sentiment would hold steady.
Bullish analysts were undeterred, however, by the data or by the market’s rough week.
“The market just needed to take a rest,” said Steve Todd, editor of Todd Market Forecast in Mission Viejo.
As investors piled into stocks Friday, the bond market slumped, sending the yield on the benchmark 10-year Treasury note to 3.78% from 3.69% on Thursday.
Among the day’s Wall Street highlights:
* Walt Disney rallied $1.15 to $26.10 on rumors that Comcast might raise its takeover bid. A Comcast spokesman denied the speculation.
* Helping to spur Nasdaq’s hefty gain, Dell Computer jumped $1.06 to $33.05 on analyst upgrades from two brokerages.
* Electronics maker Jabil Circuit climbed $1.49 to $27.49 on an upgrade from a brokerage analyst.
* Aetna zoomed $4.77 to $84.42 after raising its profit forecast for the current quarter and full year.
* King Pharmaceuticals dropped $1.07 to $16.99 after vowing to contest a Food & Drug Administration ruling that could weaken patent protection for its muscle relaxant Skelaxin.
* Petco Animal Supplies slid 80 cents to $30.30 after saying sales for its latest quarter were below expectations.
