Wall Street ends week with gains

By LISA SINGHANIA

Associated Press

NEW YORK – Wall Street went on a buying spree today, encouraged by a government employment report that could bolster the case for an interest rate cut early next year. Investors were so optimistic they shrugged off an earnings warning from Intel.

The Dow Jones industrials and Nasdaq composite each had solid triple-digit gains until the afternoon but gave up some ground before the close, partly because of the continuing uncertainty from the presidential election.

The Dow closed up 95.55 at 10,712.91, a 0.9 percent gain, according to preliminary calcuations, after spiking more than 185 points.

Broader measures also advanced, particularly the Nasdaq, rising 164.07 to 2,916.73. The Standard &Poor’s 500 index rose 26.20 to 1,369.75.

Stocks got a lift from the Labor Department’s report that job growth remained weak in November for the second straight month, helping the unemployment rate edge up to 4.0 percent. It was the first increase in the jobless rate since August. The growth is viewed as a sign the economy is moderating, and a possible reason for the Fed to reduce interest rates.

“It’s not a bad looking market,” said Larry Rice, chief investment officer at Josephthal &Co. “Usually you have a rally and it’s a bunch of blue chips or big Nasdaq stocks and today and yesterday the breadth was actually broad and pretty decent.”

Tech stocks surged ahead despite a warning late Thursday from Intel, the latest high-profile tech company to forecast an earnings slowdown. Intel was up $1.63 at $33.94 after announcing that its fourth-quarter revenues would be flat due to slowing demand for PCs.

Motorola, which had warned late Wednesday, was 10 percent higher, gaining $1.81 to $19.50. Other tech bellwethers also fared well. Oracle was up $1.75 at $30.06, and Cisco Systems was up $2.47 at $52.41.

Over the past few months, warnings such as Intel’s prompted massive selling on Wall Street. Analysts said the market’s different reaction today showed investors were taking the warnings in stride, and may be viewing the technology sector as being oversold.

Despite the overall gains in the tech sector, there were some notable exceptions to the updraft. Sun Microsystems was also off $3.88 at $38.94.

The surge in high-tech helped lift financial stocks as well, but other sectors were not sharing in the advance. Health care stocks were mainly lower, as were consumer staple makers and utilities. The three sectors are popular with investors in times of uncertainty, but Wall Street wasn’t interested today.

Procter &Gamble was off $2.31 at $71.25; Merck fell $2.13 to $89 and Duke Energy slipped 88 cents to $85.75.

But Rice, the Josepthal analyst, warned not too read too much into the market’s gains. He said the effects of the moderating economy will be felt in first and second-quarter earnings, too, so just getting through the fourth-quarter reporting period won’t mean investors are home free.

“When is the shoe going to drop on Cisco, on Juniper, these other big Nasdaq stocks that are still selling at a signifcant premium?” he said.

Advancing issues were ahead of decliners by 2 to 1 on the New York Stock Exchange, where volume came to 944.88 million shares, ahead of the 878.06 million shares at the same time Thursday.

The Russell 2000 index rose 13.17 to 474.27.

Overseas, Japan’s Nikkei stock average fell 0.2 percent. Germany’s DAX index rose 1.9 percent, Britain’s FT-SE 100 gained 0.9 percent, and France’s CAC-40 slipped 0.8 percent.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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