Recent sessions suggest the postwar rally is running out of momentum. But optimists could take solace that major averages ended at or near session highs Tuesday as traders sloughed off a warning from Nokia ( NOK), and lingering concerns about
Monday's shake-up at Freddie Mac ( FRE). Early buying gave way to late-day selling, and some traders thought the downturn might accelerate into the close. But major averages avoided trading in arrears during the afternoon slide and rebounded smartly in the final 30 minutes of trading. After trading as high as 9059.29 shortly after 10 a.m. EDT, the Dow Jones Industrial Average fell below 9000 late in the day, before rallying again to finish up 0.8% to 9054.89. Following similar patterns, the S&P 500 ended up 0.9% to its intraday best of 984.84, while the Nasdaq Composite gained 1.5% to 1627.67, just below its apex. For a second-straight session, trading volume declined -- with under 1.3 billion shares on the Big Board and 1.8 billion in over-the-counter trading, vs. more than 3 billion Friday and more than 2 billion for several sessions prior to that. Meanwhile, advancers bested declining stocks and new 52-week highs bested new lows 329 to 3 in New York Stock Exchange action and 156 to 3 in Nasdaq trading. To some, this recent volume retreat suggests speculative traders are being less aggressive, and the gains were relatively small in momentum sectors such as biotech, Internet, and semiconductors, which each rose more than 1%. Still, there were some big percentage moves among smaller biotech plays such as VaxGen ( VXGN), which rose 15% after receiving a grant from the federal government to work on a vaccine for AIDS. Aastrom Biosciences ( ASTM) leapt 10% in heavy trading after announcing a deal to develop tissue regeneration treatment with the nonprofit Musculoskeletal Transplant Foundation. On the flip side, Oxigene ( OXGN), which has soared in recent days, gave back 16.8% after announcing plans for a $15 million private placement of 1.5 million shares.