Late rally helps
stocks cap big week

By David Wells
Bloomberg News

NEW YORK >> Stocks rebounded in the final 90 minutes of trading today, wiping out losses to finish a fifth winning week in six, as oil and natural gas shares climbed.

Exxon Mobil Corp. and General Electric Co. lifted the Standard & Poor's 500 index and the Dow Jones industrial average. Declines in Palm Inc., Dell Computer Corp. and Agilent Technologies Inc. limited the Nasdaq composite index's gain.

With investors optimistic that the Federal Reserve's interest-rate reductions will spark faster profit growth later this year, "you have to be looking for places to buy as opposed to places to sell," said James Grefenstette, who manages $2 billion for Federated Investors Inc. in Pittsburgh.

The Dow advanced 53.16, or 0.5 percent, to 11,301.74, its highest close since Sept. 6. After falling as much as 0.5 percent, the average turned higher in the final 15 minutes as General Electric gained 88 cents to $52.99. The S&P 500 rose 3.47, or 0.3 percent, to 1,291.96. The Nasdaq gained 5.21, or 0.2 percent, to 2,198.89. For the week, the Dow climbed 4.4 percent, the Nasdaq 4.3 percent and the S&P 500 3.7 percent.

Advancers led decliners 16 to 14 on the New York Stock Exchange, with 1,635 up, 1,400 down and 240 unchanged. Volume was 1.11 billion vs. 1.34 billion yesterday. The NYSE composite index rose 1.90 to 657.15, the American Stock Exchange composite index gained 1.23 to 958.75 and the Russell 2000 index rose 1.52 to 506.28. The Treasury's 10-year note was unchanged at 96 31/32; its yield remained at 5.40 percent. The 30-year bond fell 2/32 to 94 14/32; its yield stayed at 5.77 percent.

"It's a post-Fed, post-earnings, get-out-of-the-office-early day," David Rolfe, chief investment officer of Wedgewood Partners Inc. in St. Louis. "After the excitement we've had, I don't mind days" with slower-than-average trading.

The rebound will add momentum to stocks' six-week rally "as the retail investor starts to think that the worst is really over," Philip Ruffat, a futures trader for Fuji Futures Inc. in Chicago, said in a note to clients. "It's really psychology that is driving the markets -- as a result we're still bullish."

Exxon Mobil gained $1.47 to $90.20. The world's largest publicly traded oil company was one of eight firms chosen to tap natural gas fields and work on other energy projects in Saudi Arabia as part of a $25 billion development plan.

Palm fell $2, or 28 percent, to $5.05 and was the most-active stock, with about 124 million shares trading, seven times its three-month daily average.

The biggest maker of electronic organizers said sales for the quarter will be about half already reduced forecasts because release of Palm's m500 model was delayed and customers waited for that instead of buying older versions, Chief Executive Carl Yankowski said.