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Mild rally ends
5-day losing run
NEW YORK >> A small rally halted Wall Street's five-day losing streak yesterday, but a lack of market-moving news and light volume meant there was little conviction behind the gains. Tech stocks, which bore the brunt of the market's recent selling, regained the most ground.
Even with Federal Reserve chairman Alan Greenspan reiterating his bullish economic outlook on Capitol Hill, many investors seemed to be holding back until next week's job and payroll reports, which are expected to give a clearer picture of the economic recovery. Only bargain-hunters and a handful of institutional buyers seemed to fuel the advance, analysts said.
"It's a very mild rally at this point," said Brian Pears, head equity trader at Victory Capital Management. "Everybody understood that the market got ahead of itself, which is why we had the selling. But today, it's more of an absence of selling rather than a lot of buying driving things."
The Dow Jones industrial average rose 35.25, or 0.3 percent, to 10,601.62.
Broader stock indicators were also higher. The Standard & Poor's 500 index was up 4.58, or 0.4 percent, at 1,143.67, and the tech-dominated Nasdaq composite index gained 17.54, or 0.9 percent, to 2,022.98.
The price of the Treasury's 10-year note closed up 1/8 point, while its yield fell to 4.01 percent from 4.03 percent Tuesday. Two-year Treasury notes rose 1/16 point and yielded 1.60 percent, down from 1.64 percent Tuesday.
With the Dow still more than 100 points off its recent high of 10,714.88, set on Feb. 17, stocks aren't expected to move much higher in the coming weeks, especially with earnings season over and no big economic news expected.
"We may have seen a little bounce from Greenspan, but not much," said Stephen Sachs, director of trading for Rydex Investments. "February is historically one of the weakest months of the year, and the last week of the month is the weakest week. There's not a lot driving things right now."
Stocks managed the advance despite some disappointment over the National Association of Realtors' report that existing home sales fell 5.2 percent in January to 6.04 million from 6.37 million in December. Analysts had been expecting 6.25 million homes sold for the month.
There was better news about mortgages. According to the Mortgage Bankers Association of America, consumers are still responding to historically low interest rates. The association's mortgage application index rose 2.1 percent for the week, while its refinancing index climbed 1.9 percent.
New mortgages and refinancing are considered barometers of economic growth, as consumers feel comfortable enough to take on more debt and, in the case of refinancing, have more money to put into the economy.
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