Wall Street’s new week: Stocks rally
NEW YORK – Stocks surged Monday, carrying the Dow industrials up more than 360 points, as bargain hunters returned to help Wall Street rebound from one of its worst weeks ever. But the market remained extremely nervous.
The Dow’s advance was its fifth-biggest daily point gain in history.
Monday’s gainers were spread across nearly all market sectors, an indication that cheaper prices lured buyers to the market rather than lessening fears about how the United States will retaliate for the Sept. 11 terror attacks and how long the economy will suffer. Even airline stocks were up.
The Dow closed Monday up 368.05, or 4.5 percent, at 8,603.86, recovering more than a quarter of the 1,369.70 it lost last week in its biggest-ever weekly decline. The Dow was up as much as 413.51 in the last hour Monday.
Its biggest daily point rise happened on March 16, 2000, when the Dow advanced 499.19 to 10,630.60, or 4.9 percent.
The market’s broader indicators also bounced back. The Nasdaq composite index rose 76.22, or 5.4 percent, to 1,499.41, while the Standard & Poor’s 500 index advanced 37.65, or 3.9 percent, to 1,003.45. The indexes, like the Dow, fell to their lowest levels in three years last week, the first week of trading following the attacks.
Monday’s rebound didn’t mean the market has overcome its uncertainty.
”The downtrend isn’t over yet. We are rallying in a wider range, because of the collapse,” said Bob Stovall, market strategist at Prudential Securities.
Analysts also said technical factors were likely influencing trading.
”Last week, there was kind of a panicky aspect, a throwing in of the towel. I think there is a realization that the lower prices have taken into account a lot of the bad stuff,” said Charles Pradilla, chief investment strategist at SG Cowen. ”That is not to say that there won’t be more pain. … We will continue to vacillate around.”
Among the Wall Street’s winners, 3M soared $4.69 to $91.67, Citigroup climbed $2.64 to $39, and Wal-Mart advanced $2.62 to $47.28. Insurer American International Group, which expects its pretax losses from the attack to total $500 million, rose $3.95 to $71, recouping some heavy losses from last week.
Airline stocks, which fell sharply because hijacked commercial planes were used in the attacks, rose on a $15 billion government aid package announced over the weekend. The sector was one of the weakest last week as major U.S. airlines reduced flight schedules, and laid off thousands of workers.
AMR, the parent of American Airlines, rose 40 cents to $18.30, while Delta gained $1.52 to $23.99.
Wall Street also drew some support from overseas markets. London’s FT-SE 100 index finished up 4.1 percent, France’s CAC-40 closed with a gain of 5.7 percent, and Frankfurt’s DAX index rose 6.6 percent. Japanese markets were closed for a holiday.
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