NEW YORK >> The prospect of government help for the economy bolstered Wall Street today, as President Bush's latest push for a stimulus plan pulled stocks from a moderate slump. Bush's comments helped the market shake off earnings warnings from Sun Microsystems, Advanced Micro Devices and Gateway and allowed tech stocks to claim their first four-day winning steak since June.
Bush economic stimulus
talk propels stocks
While investors were encouraged by prospects of $60 billion in tax cuts for businesses and individuals, they were wary of making big commitments because an economic turnaround is still uncertain at best.
Analysts say any gains on Wall Street will be vulnerable while investors await signs that business is improving and while it's still unknown how the United States will retaliate for the Sept. 11 terrorist attacks.
"We're going to be going sort of day to day as far as what our feeling is on stock prices, based on the economic and political events," said Arthur Hogan, chief market analyst for Jefferies & Co. "It's still a very tenuous time."
The Dow Jones industrial average finished today up 58.89 at 9,119.77. The blue chips have now recouped 884 points, or nearly 65 percent, of the 1,369 lost in the first week of trading following last month's terrorist attacks. Like the Dow, the broader market ended higher after slumping much of the day. The Nasdaq composite index rose 7.99 to 1,605.30, having climbed more than 120 in the past four sessions. The last time the tech-focused index had four consecutive wins was June 26-29. The Standard & Poor's 500 index rose 1.76 to 1,071.38.
Advancers edged decliners on the New York Stock Exchange, with 1,566 up, 1,538 down and 191 unchanged. Volume was 1.30 billion shares vs. 1.25 billion shares yesterday.
The NYSE composite index fell 0.38 to 554.40, the American Stock Exchange composite index rose 4.68 to 833.28 and the Russell 2000 index fell 2.07 to 414.97. The Treasury's 2-year note rose 1/32 to 100 - 2/32; its yield fell 2 basis points to 2.71 percent. The 10-year note remained at 103 - 29/32; its yield stayed at 4.50 percent. The 30-year bond fell 3/32 to 101; its yield rose 1 basis point to 5.31 percent.
Traders refrained from making major decisions on high-tech stocks based on a string of warnings. Computer chip maker AMD fell 40 cents to $8.60 after forecasting bigger-than-expected third quarter losses. But Sun Microsystems rose 58 cents to $9.87, despite warning of a wider loss for its fiscal first quarter, and Gateway, which issued a third-quarter warning, gained 15 cents to $5.
Still, the big-name tech warnings disappointed investors and held back the market for much of the day. Wall Street was increasingly optimistic about the tech sector as Dell Computer affirmed its earnings expectations yesterday and Cisco stood by its outlook on Tuesday. Today, Dell rose 24 cents to $22.56, and Cisco advanced 52 cents to $14.94.
Meanwhile, Newport News Shipbuilding Inc., which agreed to be acquired by General Dynamics Corp. for $2.6 billion, said after the market closed today that it will begin talks with Northrop Grumman Corp. about a higher offer. Newport News, a maker of nuclear submarines and aircraft carriers, decided to open talks because the recent rise of Northrop's stock price has boosted the value of a cash-and-stock offer the company made to about $72.67 a share.