Advertisement - Click to support our sponsors.
Dow up 154.5;
Associated Press
Nasdaq tops 4,000NEW YORK -- Stocks rose strongly today as investors welcomed the latest indication that the economy is slowing enough to prevent more interest rate increases. The brightening mood particularly helped banks and retailers.
The Dow Jones industrial average rose 154.51, or nearly 1.5 percent, to close at 10,635.98. The Nasdaq composite index rose 62.63, or 1.6 percent, to 4,023.20 and the Standard & Poor's 500 index was up 22.23, or 1.5 percent, at 1,478.90. Advancers beat decliners by a 5-to-3 margin, with 1,804 up, 1087 down and 451 unchanged on the New York Stock Exchange, where volume was 932.09 million shares, down from 947.08 million yesterday. The NYSE composite index climbed 8.61 to 654.36; the American Stock Exchange composite index gained 936.48; and the Russell 2000 index rose 4.90 to 528.22. The yield on the U.S. Treasury's 30-year bond dropped 4 basis points to 5.87 percent, as its price rose 18/32 point, or $5.621/2 per $1,000.
Stocks gained after a Labor Department report showed American businesses added fewer jobs than expected in June. It presented the clearest evidence yet that the Federal Reserve is succeeding in its campaign to keep the economy from overheating. "There is a feeling in the market that we are in the 8th inning of interest rate rises," said Steven Goldman, strategist for Weeden & Co. of Greenwich, Conn. "And that's put stocks in a pre-emptive mode."
An improving outlook for interest rates put a glow on financial companies, which benefit from steady or declining interest rates. Chase Manhattan and BankAmerica rose strongly. Hawaii's two largest banks also gained, with First Hawaiian parent BancWest Corp. up $1.50 to $17.94 and Bank of Hawaii parent Pacific Century Financial Corp. 81 cents higher at $15.69.