Stock indexes all
end the week higher

The Dow jumped 700 points
in its first 4-day winning streak
in nearly 7 months

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By Amy Baldwin
Associated Press

NEW YORK >> Investors, feeling more confident after the market's huge three-day rally, refrained from making major moves today, allowing the three major stock indexes to all end the week higher for the first time in three months. The Dow industrials scored 700 points in their first four-day winning streak in nearly seven months.

Technology enjoyed a strong weekly advance, but today was pulled lower in part by a downgrade in the storage sector.

"There are a number of issues that are giving investors a little more confidence about putting their money to work in stocks," said Charles G. Crane, strategist for Victory SBSF Capital Management. "I think there is a realization that earnings, while maybe not on a rocket ship trajectory, are trending up."

Advancing issues narrowly outnumbered decliners nearly 3 to 2 on the New York Stock Exchange where volume was light. The Dow closed up 33.43, or 0.4 percent, at 8,745.45.

Combined with triple-digit surges Tuesday through yesterday, the Dow has climbed 701.82 in four sessions. The Dow hasn't had four consecutive gains since the four sessions that ended Jan. 28, yielding a 90-point advance.

The broader market was mixed. The Standard & Poor's 500 index rose 3.18, or 0.4 percent, to 908.64, following a three-day advance of 70.86. The Nasdaq composite index fell 10.40, or 0.8 percent, to 1,306.12, following a three-day gain of 110.51. The Russell 2000 index fell 1.39, or 0.4 percent, to 388.45. All four indexes ended the week higher for the first time in three months, or since the week that ended May 17. For the week, the Dow gained 5.2 percent, the S&P advanced 5.1 percent, the Nasdaq rose 4.7 percent and the Russell was up 3.2 percent.

The price of the Treasury's 10-year note was up 1 point today, while its yield fell to 4.22 percent from 4.40 percent late yesterday. Two-year Treasury notes were up 1/32 point and yielded 2.06 percent, down from 2.09 percent yesterday.

"As simple and basic as it sounds the market has some positive momentum. It always swings on emotion," said Tony Cecin, director of institutional trading at US Bancorp Piper Jaffray in Minneapolis.

The market's recent strength comes as investors are increasingly confident that the Federal Reserve will cut interest rates, either at next week's meeting or in September, to keep the economy from falling back into recession.

An economic report today gave the market another reason to expect a rate cut. The Labor Department reported that productivity grew at its slowest pace in a year, rising at an annual rate of 1.1 percent in the second quarter. Economists' expectations ranged from growth rate of 0.5 percent to 1.5 percent.

Analysts said investors are also feeling more in the mood to buy stocks as the Aug. 14 deadline approaches for the nation's largest companies to certify their financial results.

"We are at a point where the number of negatives out there, and there are still many, are at least neutralized by a growing number of positives," Crane said.

Among today's winners, Pixar Animation Studios, producer of the movies Monsters Inc. and Toy Story, advanced $1.70 to $43.24 after raising its 2002 earnings outlook.

Clothing retailer Aeropostale rose $1.30 to $17.15 after US Bancorp Piper Jaffray raised its recommendation on the stock to "strong buy."

In technology, however, storage stocks were weak following downgrades of Emulex by Legg Mason and Goldman Sachs. Emulex dropped $8.25, or nearly 35 percent, to $15.36, and Brocade Communications stumbled $1.92 to $15.36.

Overseas, Japan's Nikkei stock average finished Friday up 2 percent. In Europe, France's CAC-40 rose 1.8 percent, Britain's FTSE 100 gained 1.9 percent, and Germany's DAX index climbed 2.2 percent.