- The Washington Times - Thursday, December 23, 2004

NEW YORK (AP) — Investors filled with holiday cheer sent Wall Street’s major indexes to new multiyear highs yesterday, extending the stock market’s winning steak despite a plummeting dollar and signs of weaker consumer spending.

In a session that ended with Santa Claus sounding the closing bell, investors looked past the dollar’s new low against the euro, which rose to $1.3483 against the greenback, surpassing its record high set Dec. 7. Although the weaker dollar raises the possibility of higher inflation, investors saw the U.S. currency’s decline as an opportunity to help close the trade deficit, because American goods will be less expensive abroad.

And stocks rose despite a Commerce Department report confirming that Americans have reined in their spending. Consumer spending rose 0.2 percent last month, slightly less than the 0.3 percent Wall Street expected and far less than the 0.8 percent jump in October.

“Right now, there’s just no selling going on,” said Todd Leone, managing director of equity trading at SG Cowen Securities. “There’s a lot of money being put to work before the end of the year, and I think that despite whatever news we get, we’ll just continue drifting up.”

The Dow Jones Industrial Average rose 11.23, or 0.1 percent, to 10,827.12, its highest close since June 13, 2001.

Broader stock indicators were modestly higher. The Standard & Poor’s 500 index was up 0.56, or 0.05 percent, at 1,210.13, the best close for the index since Aug. 3, 2001. The Nasdaq Composite Index gained 3.59, or 0.17 percent, at 2,160.62.

Stocks rallied through the holiday-shortened week, with investor optimism remaining high. The Dow reached new three-and-a-half-year highs for three straight sessions, while the S&P; saw its second straight high. The Nasdaq, struggling with disappointing earnings and outlooks from technology firms, failed to break the multiyear high set Wednesday.

For the week, the Dow rose 1.66 percent, the S&P; gained 1.33 percent, and the Nasdaq climbed 1.19 percent. It was the second week of gains for the major indexes, which have risen in five of the past seven weeks.

Most global financial markets were to close today in observance of Christmas.

“On balance, the economic news was OK, not blockbuster, but good enough,” said Ken Tower, chief market strategist for Schwab’s CyberTrader. “We’re still in a very robust rally, and there are no signs that I can see that would stop it from continuing.”

PalmSource Inc. dropped 45 cents to $12.78 after the hand-held software maker said it swung to a profit in the second quarter, but added that profits in the third quarter would be lower than Wall Street estimates.

Computer software maker Red Hat Inc. saw its profits jump 55 percent in the quarter, meeting Wall Street’s profit expectations. However, the company’s shares fell $2.04 to $13.03 as the Linux distributor missed its revenue targets.

Advancing issues outnumbered decliners by about 5-to-4 on the New York Stock Exchange, where preliminary consolidated volume came to 1.19 billion shares.

, compared with 1.78 billion on Wednesday.

The Russell 2000 index of smaller companies was up 0.91, or 0.14 percent, at 649.37.

In Europe, Britain’s FTSE 100 closed up 0.22 percent, France’s CAC-40 climbed 0.36 percent for the session, and Germany’s DAX index rose 0.24 percent.

LOAD COMMENTS ()

 

Click to Read More

Click to Hide