US stocks rally again
Wall Street extended its big rally today, propelling the Dow Jones industrials up 122 points despite the absence of economic or earnings news to guide investors.
The blue chips’ advance was their second straight triple-digit win. As the market gains in upward momentum, analysts say investors are afraid of being left behind.
“Last week, you had people chasing stocks for the first time in quite a spell, and it is a good sign,” said Michael Murphy, head trader at Wachovia Securities in Baltimore.
Murphy added: “It ain’t 1998 or 1999, but it feels pretty good. You can tell there’s a buzz in the room. The right guys are calling in and buying stocks and it is more of a longer-term call. Hedge funds are always a part of it, but we are starting to see some of the bigger players putting money to work.”
Building on two straight weekly gains, the Dow closed up 122.13, or 1.4%, at 8,726.73, according to preliminary calculations. On Friday, the Dow surged 113.38.
The market’s broader gauges also posted big gains, having climbed higher for four consecutive weeks. The Nasdaq composite index rose 21.25, or 1.5%, to 1,541.40. The Standard & Poor’s 500 index advanced 11.70, or 1.3%, to 945.11.
There was little news to influence the market, as no major economic reports were scheduled, and few companies were releasing first-quarter results.
Stocks were defying a recent tendency to retreat after big advances. And, the gains have been big.
Since March 11, when the market’s major indexes were at their lowest levels since hitting multi-year lows in October, the Nasdaq has barrelled back 21.2%. The Dow has made a comeback of 16%, while the S&P has recouped 18%.
Some pullback is to be expected after weeks of hefty rallies based on better-than-expected first-quarter earnings reports. But so far, any selling has been moderate, short-lived and on light volume, all of which analysts say are indications that investors are growing more confident about the market.
“We are two months into this rally ... (and) yet the market refuses to go down. It may be indicative that we are in the early stages of a more prolonged move higher,” said Richard A. Dickson, senior market strategist, at Lowry’s Research Reports in Palm Beach, Florida.
Retailers, among the last major companies to report first-quarter profits, traded higher Monday even as investors awaited results due out this week.
Wal-Mart rose 90 cents to 56.70 dollars ahead of its first-quarter earnings scheduled for release on Tuesday. Target, due to report results Thursday, rose 86 cents to 36.13 dollars.
Investors also gave Dell a boost, sending it up 81 cents to 31.90 dollars ahead of earnings slated to be released Thursday.
Brokerage house upgrades lifted other individual stocks.
AnnTaylor advanced 1.65 dollars to 24.92 dollars after Prudential Securities raised its recommendation on the company to ”buy” from “hold.”
Cisco Systems rose 72 cents to 16.67 dollars after Lehman Brothers upgraded the networker to “overweight” from ”equal-weight.”
Advancing issues outnumbered decliners slightly more than 2 to 1 on the New York Stock Exchange. Trading volume was light.
The Russell 2000 index, which tracks smaller company stocks, rose 4.67, or 1.1%, to 418.20.
Overseas, Japan’s Nikkei stock average finished up 0.9%. In Europe, Britain’s FTSE 100 rose 0.5%, while France’s CAC-40 slipped 0.2% and Germany’s DAX index lost 0.7%.
