Updated from 4:08 p.m. EDT
Stocks finished a brutal week with modest gains Friday as options expirations and the proximity of various key technical levels kept trading volume high and prices volatile.
Dow Jones Industrial Average
closed up 44 points, or 0.6%, at 7986. The
gained 5 points, or 0.4%, at 1221, and the
added 2 points, 0.3%, at 845. Volume was about 1.5 billion shares on the NYSE and the Nasdaq
The Dow still ended the week down about 3% after losing 437 points between Tuesday and Thursday. At 7986, the average remains fewer than 300 points above its July 23 close of 7702. The Nasdaq's five-year low is 1206, set Aug. 5.
Trading was choppy Friday because of the so-called triple-witching options expiration, in which the unwinding of various futures contracts can lead to big price swings.
Among sectors, cruise lines, food, defense, and homebuilders were strongest, while tobacco, utilities, biotech and retail were weaker. Advancers edged decliners 7 to 6 on both the
New York Stock Exchange and the Nasdaq.
Supporting the market was a bullish sales outlook from
. The semiconductor maker said late Thursday that it expects to ship about 20 million chips in the quarter ending Sept. 29, up from previous guidance of 18 million to 19 million, and said it will ship significantly more in the next quarter. Qualcomm shares traded up 9.1% to $28.08.
Some analysts scoffed at Qualcomm's forecasts. CIBC urged caution, telling investors that inventory buildups could lead to a correction. Morgan Stanley, however, raised its full-year earnings forecast to 95 cents a share, reiterating its overweight rating and $60 price target.
Elsewhere on the chip front,
fell 7.3% to $15.78 after Salomon Smith Barney downgraded the company to in line from outperform, halving its price target to $15.
dropped 9.2% to $13.87 after Bear Stearns cut its fourth-quarter outlook.
Overall, semiconductors were down 1.4% after the Philadelphia Semiconductor Index hit a new 52-week low at the open. The SOX is down 17% for September.
Meanwhile, the National Association of Securities Dealers is expected to file administrative fraud charges against
Salomon Smith Barney unit and its former telecom analyst Jack Grubman,
The Wall Street Journal
reported. The charges relate to the firm's positive research on now-bankrupt
. Citigroup shares, which have lost 5.9% so far this week, slipped 3% to $26.83.
was a big gainer after announcing a partnership with
to develop an Amylin diabetes treatment. The stock ended up 10% at $13.90.
saw its shares drop 5.5% to $16.99 after announcing it is paring its full-year earnings outlook and taking a third-quarter restructuring charge amid an industrywide slowdown. The Charlotte, N.C.-based company expects to earn $1.95 to $2.05 a share for 2002, excluding charges. Previous guidance called for a net profit of $2.45 to $2.55 a share. Analysts were expecting earnings of $2.46 a share, according to research firm First Call/Thomson Financial.
On the economic front, the federal government posted a $54.71 billion budget deficit in August, down from an $80 billion deficit a year earlier.
In Treasuries, the 10-year note was flat at 104 29/32, yielding 3.78%. The long bond was down 21/32 to 109 25/32 to yield 4.74%
Bargain-hunters came out in Europe overnight with London's FTSE 100 rising 1.2% to 3860 and Germany's Xetra DAX was inching up 2.2% to 3072. In Asia, Japan's Nikkei fell 2% to 9481 while Hong Kong's Hang Seng lost 1% to 9328.