In what traders said was the result of repositioning at the end of the quarter, the
Dow Jones Industrial Average and
Nasdaq Composite Index traded tentatively higher today.
On the final day of the quarter, traders saw a good bit of window dressing, which happens when institutional investors tidy up their portfolios to improve their appearance for presentation to clients or shareholders. Typically, institutions sell stocks they don't want and buy more of the names that are doing well at the end of a quarter. And they put cash sitting on the sidelines back into the stock market, helping to boost stocks.
"Institutional investors are window dressing stocks they want to show in their portfolios," said Bob Basel, director of listed trading at
Salomon Smith Barney
earlier in the day. "We're seeing a push-pull at the end of the quarter."
But for much of the day, investors were sitting on their hands. "The recent trend is for Friday to be the slowest day of the week, either because of trader burnout, or because people are disgusted and going home early," said Bill Schneider, head of U.S. equity block trading at
. The trader sees no real reason for today's gains and doesn't think the market has reached a selling crescendo.
Today's action comes on the heels of steep losses in the technology sector. Selling on Wednesday and Thursday took 7.7% off the Nasdaq's value. The tech index hit a new 29-month low yesterday. After taking back 1% today, it is still down close to 5% for the week. For the quarter, it's down 26%, making this the worst quarter ever in the index's history. To complete these dreary statistics, it's also nearly 64% off its all-time high.
Investors are preparing for an onslaught of preannouncements likely to come from the tech sector. Despite today's gains, the earnings picture couldn't get much worse. After the closing bell yesterday, chipmaker
reported earnings that beat consensus estimates. But amid slowing sales, the stock fell 8.2% to $41.53 today.
More bad news about the economy hit the market today, but it had a muted effect on stocks. Released at 10 a.m. EST, the
Chicago Purchasing Managers' Index dropped to its lowest level since March 1982. The index measures the health of the manufacturing sector, considered to be the most beleaguered area of the U.S. economy. Today's number revealed more weakness on that front.
Many of the best-performing stocks on the
S&P 500 for the quarter were down today, due most likely to profit taking.
Advanced Micro Devices
shed 6.2% to $26.54
dropped 2.6% to $9.40,
shed 1.2% to $22.07, and
lowered 0.3% to $9.75.
University of Michigan Consumer Sentiment Index, out earlier this morning, confirmed the consumer optimism revealed by Tuesday's consumer confidence index. The report, which measures consumers' attitudes on the economy, rose to 91.5 from 90.6 in February.
Leading the Dow higher were shares of
, up 6% to $41.30. According to a report in
is rumored to be courting the financial giant.
closed up 0.6% to $44.98. The blue-chip index gained 4% on the week but is down about 15% from its peak.
gained 17.13% to $13.47, after it called off its planned $3.2 billion merger with meat packing firm
. In recent trading, IBP plunged 28% to $16.40.
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European markets scratched up modest gains today. London's
, still trading near two-year lows, was lifted by gains in blue-chips. The FTSE rose 45 points, or 0.8%, to 5634. Across the channel, the Paris
increased 22.5, or 0.4%, to 5180, while Frankfurt's
shed 49.4, or 0.8%, to 5830.
The euro was lately trading at $0.8847.
Asian markets closed mixed. Adding to a 5% loss Thursday, Tokyo's
slipped another 0.56% overnight. The key index rose in early trading, as investors bet that end-of-the-quarter window dressing would give stocks a lift. But when stocks failed to rally, investors began to sell their holdings. The Nikkei closed down 72.7 points to 12,999.7. Hong Kong's
rose overnight, however, after hitting a new 17-month low Thursday. The index closed up 82.8, or 0.7%, to 12,760.6
The dollar was trading at 125.1 yen.
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