This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Market Update: Dow Gains Almost 1%, Nasdaq Closes Down

( Updated from 4:14 p.m. EDT)

As if on cue, the economy kicked off the second half with nascent signs of the recovery upon which Wall Street has pinned its hopes -- and the markets responded approvingly.

The blue-chip Dow was firmly in the bulls' grip by midmorning after some strong manufacturing data eclipsed earnings worries generated earlier by a warning from 3M (MMM). But gains were more elusive on the Nasdaq Composite Index , as investors took profits following Friday's late-day rally.

The blue-chip Dow Jones Industrial Average ended the day up by 91.25 points, or 0.87%, to 10,593.65; the Nasdaq lost 11.81 points, or 0.55%, to 2148.73; and the S&P 500 , which tracks the broader market, closed up by 12.35 points, or 1.01%, to about 1236.73.

Major Indices
INDEX CHANGE % VALUE
Dow 91.25 0.87% 10,593.65
S&P 500 12.35 1.01% 1236.73
Nasdaq 11.81 -0.55% 2148.73
Russell 2000 13.93 -2.72% 498.71
TSC Internet 0.01 -0.00% 244.66
NOTE CHANGE PRICE YIELD
10-Year Treasury 14/32 97 15/32 5.337%
Market data as of: 4:10 PM ET, Mon Jul 2 2001




Volume was tame ahead of the Fourth of July. The market closes at 1 p.m. EDT Tuesday and remains closed Wednesday in observance of the holiday.

"The NAPM should carry us through today," said Peter Blatchford, trader at Miller Tabak. But he said he didn't know if the data was strong enough to carry stocks higher through tomorrow morning and Thursday. "The market is in a mode where the equity markets are anticipating improvement, but it just depends on how bad imminent preannouncements are," he said.

The National Association of Purchasing Management's purchasing managers' index , a key gauge of the manufacturing sector, showed substantially more strength than economists had predicted. Released at 10 a.m., the indicator showed a 44.7 reading for June, above the expected 42.8 and May's 42.1 reading. The June number marks the indicator's highest level since the 47.9 reading of November 2000. The NAPM signals expansion when above 50 and contraction when below it.

Meanwhile, this morning's personal income and spending data, released at 8:30 a.m. EDT, showed that consumers continue to spend despite weakness in income. Income grew a tenth of a percent more slowly than was expected, and spending rose a tenth of percent faster than was expected for both May and April. U.S. construction spending, meanwhile, rose 0.3% in May, right in line with economists' forecasts. Construction spending for the month of April was revised up to 0.4% from 0.3%.

On Friday, the Nasdaq rallied sharply between 4 p.m. and 5 p.m. after the exchange extended trading to make up for time lost to earlier network glitches. Tech stocks rose late in the day amid end-of-quarter window dressing and the annual rebalancing of the Russell stock indices. At the end of each quarter, managers dress up their portfolios to present to shareholders; the Russell rebalancing forces money managers with funds tracking the indices to sell and buy stocks to match the changes.

At 2 p.m., the Nasdaq released a partial list of securities for which Friday's closing prices were adjusted. That list included 65 securities, including Dell (DELL), Microsoft (MSFT), Tellabs (TLAB)and Worldcom (WCOM), among others, according to the NasdaqTrader.com site.

The exchange will post further changes in Vendor Alerts on NasdaqTrader.com. The Russell 2000 closed off by 2.8%.

This morning, investors sold stocks in reaction to 3M's news that it was lowering its targets for second-quarter earnings and expecting overseas weakness to hurt its second-half results. The company's stock posted gains today, though, closing higher by 2.8% to $117.26.

Earnings confession season -- when companies warn they expect to miss performance targets -- is expected to wind down this week. Company after company has warned over the past four weeks that second-quarter earnings and sales will fall short of forecasts. Wall Street is now hoping that corporate earnings will accelerate in the fourth quarter of this year or early next year. And some strategists are betting stocks will begin to rise in anticipation of that recovery.

Optimism that an economic recovery might come later this year was reignited by the Federal Reserve's fifth interest-rate cut last Wednesday and some signs of strength in economic data. After cutting rates by a half-point five times this year, the Fed dropped the federal funds lending target by a quarter-point to 3.75% and indicated that it may be winding down its rate-cutting program.

Tobacco stocks were lower today after the Supreme Court refused to hear an appeal by tobacco company Brown & Williamson for a health lawsuit it lost against a U.S. smoker. The case is the first such lawsuit to be won by a smoker against a tobacco company. The Dow Jones U.S. Tobacco Index closed off by 3.3%.

Elsewhere in sector moves, chip and PC stocks as well as banks and retailers gained today. Brokers, transportation, gold and energy stocks were all lower.

Back to top

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
UAL $53.56 -0.26%
AAPL $131.55 -0.37%
FB $80.25 -0.37%
GOOG $539.08 -0.13%
TSLA $250.11 1.10%

Markets

DOW 18,100.49 -62.50 -0.34%
S&P 500 2,115.99 -7.49 -0.35%
NASDAQ 5,090.5940 -15.9990 -0.31%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs