Wary investors lift stocks
ahead of Fed meeting

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By Amy Baldwin
Associated Press

NEW YORK >> The market got a lift today from bargain hunters who sought out stocks at cheaper prices despite little indication that business is getting better.

Analysts were doubtful that the small gains -- which followed big losses from last week -- would be long-lasting given investors' persistent worries about earnings and the economy. The market won't really head higher, they say, until companies are able to say that profits and sales are improving.

The Dow Jones industrial average finished up 79.29, or 0.8 percent, at 10,320.07. The Dow recovered a small part of the 1.7 percent it lost last week.

The market's broader indicators also advanced. The Nasdaq composite index rose 14.34 to 1,881.35 after falling to a new four-month low last week. The Standard & Poor's 500 index gained 9.44 to 1,171.41.

Advancers led decliners slightly more than 8 to 7 on the New York Stock Exchange, with 1,763 up, 1,339 down and 223 unchanged. Volume was 872.41 million shares vs. 975.39 million on Friday.

The NYSE composite index rose 3.99 to 603.17, the American Stock Exchange composite index gained 3.24 to 887.92 and the Russell 2000 index, the barometer of smaller company stocks, rose 3.22 to 478.87.

The Treasury's 10-year note fell 1732 to 100 23/32; its yield rose 7 basis points to 4.91 percent. The 30-year bond fell 12 to 98 2732; its yield rose 4 basis points to 5.46 percent.

"It's a little bit of bargain hunting. Maybe some of the sellers are taking a day off after being quite active last week. It's just a bounce," said Bob Streed, portfolio manager of Northern Select Equity Fund in Chicago.

Volume was light. Analysts had anticipated investors to make careful decisions about which stocks to buy and sell today and tomorrow ahead of the Federal Reserve's decision on interest rates. The Fed is expected to lower rates by a quarter percentage point tomorrow -- its seventh cut this year -- in an attempt to reinvigorate the economy.

"It's typical for the markets to put in a holding action prior to a Fed meeting," said A.C. Moore, chief investment strategist for Dunvegan Associates in Santa Barbara, Calif.

Meanwhile, a positive report on the economy had little effect on trading, analysts said. The New York-based Conference Board reported that its Index of Leading Economic Indicators rose for the fourth straight month in July, suggesting the economy is improving.

Among today's winners on Wall Street was Lowe's, which rose $2.80 to $37.84 after beating second-quarter earnings estimates by a penny a share. Toys R Us advanced $1.62 to $24.02 after meeting expectations with a loss of 15 cents a share but saying it expects positive results in the fourth quarter. After the market closed, Agilent Technologies Inc., the maker of test and management gear, said it will cut 4,000 jobs, or 9 percent of its work force