Stocks end higher Wednesday
Wednesday, December 12, 2001
AP Business WriterNEW YORK (AP) -- Buyers still worried about the economy but unable to resist bargain prices went back to Wall Street late in Wednesday's session, giving stocks some modest, hard-fought gains.
Investors overcame their misgivings about earnings warnings from Merck and American Express, which had sent prices falling for much of the day.
"Investors want to be buyers at lower prices, and I guess we just hit lower prices," said Scott Bleier, chief investment strategist at Prime Charter Ltd. "There is a big desire to get money back to work on weakness, which is why the bouts of profit taking have been limited. Money wants to get into stocks."
The Dow Jones industrial average closed up 6.44, or nearly 0.1 percent, at 9,894.81, after falling as much as 81 earlier.
The broader market followed the same path, turning losses into gains in the last 30 minutes of trading. The Nasdaq composite index ended up 9.45, or 0.5 percent, to 2,011.38, having lost 26 points at one point. The Standard & Poor's 500 index inched up 0.31, or 0.03 percent, to 1,137.07, recovering from an earlier 10-point loss.
Analysts were unfazed by the selling that persisted for most of the session, and said the market's post-attack comeback is more important than occasional downturns.
The Dow is 20.1 percent above its Sept. 21 low for the year of 8,235.81, which followed the Sept. 11 terror attacks. The Nasdaq is up 41.3 percent from its low; the S&P, up 17.7 percent.
"To come back from that kind of hit is a Herculean feat, and basically states there will be an economic recovery next year," Bleier said.
The market had two reasons for not trading significantly higher near Wednesday's close: Dow industrials Merck and American Express.
Merck fell $2.18 to $58.52, having on Tuesday projected no growth in earnings per share next year, mainly due to expiration of the patent on its key ulcer drug, Prilosec.
"The Merck warning took a toll on confidence," said Alan Ackerman, executive vice president of Fahnestock & Co.
American Express declined 84 cents to $33.42, after warning on Wednesday of weaker profits in the fourth quarter, and announcing 5,500 to 6,500 job cuts.
The market drew some strength from a positive outlook from Dow industrial Procter & Gamble. P&G soared $3.25 to $79.95, following an announcement Tuesday that it expects to beat analysts' earnings estimates for the current quarter by 2 to 3 cents a share.
But much of the market's late-day boost came from the technology sector, which has suffered the most from the economic slump and which many analysts have predicted will ultimately lead the market higher. IBM rose $1.70 to $123.20, and Intel climbed 89 cents to $34.08.
Declining issues outnumbered advancers 8 to 7 on the New York Stock Exchange. Volume totaled 1.40 billion shares, ahead of Tuesday's 1.35 billion shares.
The Russell 2000 index, which tracks smaller company stocks, advanced 0.54, or 0.1 percent, to 475.31.
Overseas, markets were mixed Wednesday. Japan's Nikkei stock average closed up 3.1 percent. In Europe, France's CAC-40 finished down 0.9 percent, Britain's FT-SE 100 fell 0.8 percent and Germany's DAX index declined 1.6 percent.
On the Net:
New York Stock Exchange: http://www.nyse.com
Nasdaq Stock Market: http://www.nasdaq.com