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Brokerage earnings
push stocks higher
NEW YORK >> Wall Street pushed higher yesterday as strong earnings from companies such as Morgan Stanley helped offset investors' lingering concerns about a weak dollar. Defense stocks, however, sagged on a downgrade from Smith Barney.
Trading was choppy as many investors pondered their next move in advance of the third-quarter earnings season. Analysts said many were opting to hold off on major bets after six months of market gains.
"The dollar seems to be topping everyone's list of worries, but in the big picture, it looks like a normal course of backing and filling," said Bryan Piskorowski, market commentator at Wachovia Securities. "The market has been on a tear and it needs to digest."
The Dow Jones industrial average closed up 40.63, or 0.4 percent, to 9,576.04, having lost 109 points in the previous session.
The Nasdaq composite index gained 27.10, or 1.5 percent, to 1,901.72. The Standard & Poor's 500 index rose 6.21, or 0.6 percent, to 1,029.03.
Advancers beat decliners 9 to 5 on the New York Stock Exchange. Consolidated volume was moderate at 1.69 billion shares, compared with 1.62 billion traded Monday.
The Russell 2000 index rose 5.71, or 1.1 percent, to 519.36.
The NYSE composite index gained 23.12, or 0.4 percent, to 5,794.22. The American Stock Exchange composite index rose 5.33, or 0.5 percent, to 1,000.77.
The two-year Treasury note was unchanged at 100 2 2/32, with its yield rising 1 basis point to 1.64 percent. The 10-year note gained 1/32 to 100 1032, with its yield falling 1 basis point to 4.21 percent.
"It looks like we're having a technical reaction after (Monday's) decline and a market that still wants to move higher," said Peter Cardillo, president and chief strategist of Global Partner Securities Inc.
"We've also already started the earnings preannouncement season, and so far the warnings have been scant," he said. "That bodes well for the earnings season itself. But as we get into October, we'll probably have a market that will look to sell off on the news of good earnings."
Lehman Brothers Holdings Inc. advanced 69 cents to $70.90 as the brokerage reported third-quarter profits that handily beat Wall Street's estimates.
Morgan Stanley rose $1.18 to $52.33 as the brokerage posted a doubling in quarterly profits, citing strong performance in investment banking and capital markets.
Decliners included Verizon Communications Inc., which dropped $1.58 to $33.13, after the telecommunications company lowered its 2003 earnings outlook, citing weak business spending and falling demand.
Defense stocks also took a hit after Citigroup's Smith Barney division lowered the ratings of several companies, citing limited growth prospects. Lockheed Martin Corp. fell $1.85 to $45.97, while Northrop Grumman Corp. decreased $3.53 to $87.96.
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