NEW YORK >> Investors gave a positive spin to a batch of disquieting economic news today, bidding stocks solidly higher amid rising hopes for another interest rate cut. Dow up 113; Nasdaq
By Lisi de Bourbon
runs win streak to 4 days
Associated PressThe advance gave the Nasdaq composite index a four-day winning streak and its best week so far this year.
The market recovered from moderate losses earlier in the session, and analysts attributed its resilience to optimism that the Federal Reserve will lower interest rates for a fourth time this year when it meets May 15.
"There are no inflationary pressures like a year ago," said Gary Thayer, chief economist at A.G. Edwards & Sons. "They do think it leaves the door open for a rate cut."
The Nasdaq rose 62.48, or 3.3 percent, to 1,961.43, the first time since early September that the index has had a four-day winning streak.
With the markets closed for Good Friday, the gain meant the Nasdaq ended the week up 241.07 or 14.01 percent, its best weekly percentage gain since it rose 18.9 percent in the week ended June 2. That week contained five days, compared to the four in this holiday-shortened week.
The Dow industrial average closed up 113.47, or 1.1 percent, at 10,126.94.
For the week, the Dow gained 335.85 or 3.43 percent.
And the market's broadest measure, the Standard & Poor's 500, rose 17.61, or 1.5 percent, to 1,183.50, ending the week with a 55.07-point or 4.9 percent gain.
Advancing issues were ahead of decliners by 4 to 3 on the New York Stock Exchange, with 1,849 up, 1,165 down and 251 unchanged.
Volume came to a light 1.3 billion shares vs. yesterday's 1.27 billion.
Many traders took the day off for an extended weekend. The market will be closed tomorrow for Good Friday.
The NYSE composite index rose 6.74 to 601.74, the American Stock Exchange composite index gained 6.85 to 883.90 and the Russell 2000 index advanced 5.77 to 455.02.
The Treasury's 10-year note fell 12/32 to 98 23/32; its yield rose 5 basis points to 5.17 percent. The 30-year bond rose 6/32 to 96 23/32; its yield fell 1 basis point to 5.60 percent.
As the day started, traders looking for good news were disappointed as the nation's biggest retailers generally reported weak results for March due to unusually cold weather and the slumping economy.
Sears, Roebuck said its lackluster sales would cause it to miss first-quarter earnings projections. And Wal-Mart Stores, the nation's largest retailer, said its results came in at the low end of expectations and that it might also miss first-quarter estimates.
Sears managed to move up 9 cents to $34.74, but Wal-Mart dropped 51 cents to $49.72 and Federated Department Stores fell 24 cents to $41.41.
The Commerce Department also issued retail sales figures for March that were weaker than expected. And the Labor Department reported that the number of Americans filing new claims for state unemployment insurance last week climbed to its highest level in five years, further evidence of the weakening labor market.
Investors also were initially troubled by the spate of weak economic numbers, but the Labor Department's report of a 0.1 percent drop in wholesale prices last month raised their hopes for a further reduction in interest rates.
The decline indicated that inflation, another of the Fed's concerns, remains under control.
"Ironically, today's economic reports were all weaker than had been forecast and indeed showed outright declines, suggesting the economy is weak and that the Fed may well ease rates further to try to support the economy," said Carol Stone, deputy chief economist at Nomura Securities International Inc.
Technology stocks, which helped power the Nasdaq's advance, were mostly higher, shaking off earlier earnings concerns.
Juniper Networks, a maker of high-speed Internet routing gear, jumped $7.71 to $50.47 after meeting analysts' first-quarter earnings expectations but issuing a second-quarter outlook below analyst forecasts.
Yahoo! was up $1.10 at $16.96. On Wednesday, the Internet portal beat Wall Street's sharply reduced first-quarter earnings forecasts, but also said it is cutting its work force by 12 percent.
Broadcom was up $3.76 to $35.55, and Vitesse Semiconductor rose 17 cents to $25.70 as investors looked past J.P. Morgan's downgrade of both stocks.
Among Dow stocks, Microsoft was up $1.18 to $62.18, Hewlett-Packard gained 37 cents at $30.62 and IBM fell $1.23 to $96.20.
Nontechnology stocks also advanced. Citigroup rose 96 cents to $47.30, and
General Electric gained $1.43 to $44.70 after announcing first-quarter results that matched Wall Street's expectations.
Overseas markets were mixed.
Japan's Nikkei stock average rose 177.51 points, or 1.4 percent, to 13,352.44.
In Europe, Germany's DAX index closed up 0.9 percent, Britain's FT-SE 100 slipped 0.37 percent, and France's CAC-40 rose 0.2 percent.