Star-Bulletin news services
Stocks make
small gains
NEW YORK >> Stocks rode solid fundamentals and strong earnings to modest gains yesterday in light trading prior to Federal Reserve Chairman Alan Greenspan's congressional testimony.
Greenspan, scheduled to testify before House and Senate committees today and tomorrow, was expected to give a bullish report on the economy and reiterate that the Fed can exercise patience in raising interest rates -- something Wall Street would like to hear after last month's Fed statement that indicated rates would eventually rise.
In the meantime, without any economic or major earnings news before Greenspan's statement, the market's overall momentum kept stocks on the plus side.
"We've been in an uptrend, and the market is coming off of a couple weeks of correction that it needed," said Stephen Sachs, director of trading at Rydex Investments. "There's still money flowing into the market, and on a day like this, you'd assume that money is being put to work in index funds and other broad equities."
Advancing issues outnumbered decliners by more than 8 to 5 the New York Stock Exchange, where consolidated volume came to 1.79 billion shares, compared with 1.68 billion on Monday.
The Dow Jones industrial average rose 34.82, or 0.3 percent, to finish at 10,613.85.
Broader stock indicators were also higher. The Standard & Poor's 500 index was up 5.73, or 0.5 percent, at 1,145.54, and the Nasdaq composite index climbed 14.76, or 0.7 percent, to 2,075.33. The Russell 2000 index of smaller companies was up 7.34, or 1.2 percent, at 592.83.
The price of the Treasury's 10-year note closed down 1332 point, while its yield rose to 4.10 percent from 4.05 percent Monday. Two-year Treasury notes fell 18 point and yielded 1.80 percent, up from 1.74 percent Monday.
Stocks have traded narrowly this week in light volume after last week's erratic sessions, in which the Nasdaq lost 52 points one day and gained back 44 two days later, and the Dow rallied 97 on Friday.
"I think the past few weeks have shown resilience in the market," said Russ Koesterich, U.S. equity strategist for State Street Corp. "Volume is a little low, though, and I would probably want to wait for the big money to come in before making any big moves."
In earnings news, Viacom Inc. took a $1.3 billion charge as it announced it would shed its 81 percent stake in the Blockbuster video rental chain. With the charge, Viacom lost 23 cents per share for the quarter. Viacom was up 96 cents at $41.35, while outstanding shares of Blockbuster dropped 21 cents to $16.20.
Marriott International slumped 89 cents to $44.67 despite reporting a profit of 69 cents per share, beating Wall Street estimates by 8 cents. The hotel chain said it expected stronger sales based on increasing business travel.
After posting a charge a year ago, Clorox Co.'s profit rose 22 percent in the fourth quarter, but the company's reduced outlook sent shares skidding $2.63 to $47.52.
STOCK QUOTES/CHARTS/DATA
