- The Washington Times - Thursday, October 4, 2001

NEW YORK (AP) Wall Street had its first truly upbeat day since the terrorist attacks, surging yesterday on a positive outlook from Cisco Systems and the possibility of a $65 billion economic-stimulus package. The Dow industrials closed above 9,000 for the first time in three weeks.
The market waffled in early trading, but rose decisively as President Bush in televised remarks in New York urged Congress to approve a plan to stimulate the economy, already weak before the assaults. The plan includes tax cuts for individuals and business and is worth $60 billion to $75 billion.
Stocks, especially high-techs, widened their lead in midafternoon trading after Cisco Chief Executive John Chambers affirmed the company's outlook. The upturn on Wall Street added to a rally Tuesday triggered in part by the ninth interest-rate cut so far this year.
"People are believing that between fiscal and monetary policy, the economy will stabilize," said Arthur Hogan, chief market analyst at Jefferies & Co.
The Dow surged 173.19, closing yesterday at 9,123.78, having risen 113 Tuesday after the Federal Reserve cut rates by half a percentage point.
Yesterday was the first time the Dow has broken the 9,000 level since Sept. 18; it hadn't closed above 9,000 since the Sept. 11 terrorist attacks. The blue chips have regained nearly 900 points, or 65 percent, of the 1,369 they tumbled in the first week of trading after the attacks.
The broader market also posted significant gains. The Nasdaq Composite Index rose 88.48 to 1,580.81, recording its biggest point gain since the attacks. The Standard & Poor's 500 index advanced 20.95 to 1,072.28.
Yesterday's upturn was a switch for the market, which has struggled amid the business fallout, namely thousands of layoffs and a series of profit warnings, that has followed the attacks. While it surged higher last week and Tuesday, those advances were more technical in nature or due to bargain hunting; they lacked the more positive sentiment of yesterday's trading.
"Three weeks after the greatest shock in our collective lives, there is a tremendous realization that the world is not going to come to an end," said Scott Bleier, chief investment strategist for Prime Charter Ltd.
Mr. Bleier attributed the buying to lower interest rates, the possible economic-stimulus plan and steeply discounted stock prices.
Among Wall Street's winners were companies that stood by earnings forecasts. Cisco rose 21.5 percent, up $2.47 to $13.95, after Mr. Chambers backed the networker's earnings forecast for the fiscal first quarter despite a disruption in orders in the wake of the terrorist attacks.
Cisco's midafternoon news boosted the tech sector, where Microsoft climbed $3.18 to $56.23 and Intel rose $1.71 to $21.23.
Upscale housewares retailer Williams-Sonoma rose $4.85, or nearly 22 percent, to $27.05 after affirming third-quarter profit estimates.
Stocks rose across an array of sectors, indicating how optimistic investors were feeling about an economic recovery.
Boeing rose $2.34 to $36.59, Citigroup gained $1.23 to $43.48, and Home Depot advanced $1.78 to $40.83.
Even sectors that stand to suffer the most in the wake of the attacks, such as airlines and insurers, made strides on Wall Street. UAL, the parent of United Airlines, rose $1.45 to $22.12, while insurer American International Group gained $2.25 to $80.70.
On the downside, Eli Lilly lowered its earnings estimates for 2001 and 2002, citing poor sales of its drug Prozac owing to generic competitors. Lilly fell $3.62 to $79.25.

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