- The Washington Times - Saturday, January 5, 2002

NEW YORK (AP) Stocks rose yesterday for a third straight session, posting solid gains despite the worst monthly unemployment report in more than six years.

Investors focused on data that showed fewer jobs were cut in December than in previous months; those numbers seemed to strengthen Wall Street's conviction that there will indeed be an economic turnaround this spring. Technology stocks, which have led the market this week, continued their advance, and the momentum again spread to the broader market.

The Dow Jones Industrial Average closed up 87.60, or 0.9 percent, at 10,259.74, its best close since late August.

Broader indicators also rose. The technology-focused Nasdaq Composite Index advanced 15.11, or 0.7 percent, to 2,059.38. The Standard & Poor's 500 index climbed 7.24, or 0.6 percent, to 1,172.51. The Russell 2000 index rose 3.79 to 499.30.

For the week, the Dow rose 1.2 percent, the Nasdaq gained 3.6 percent and the S&P advanced nearly 1.0 percent.

The market moved higher yesterday even as the Labor Department reported the nation's unemployment rate rose to 5.8 percent in December as businesses cut 124,000 jobs. Still, the losses were less severe than in recent months. Job losses had averaged about 400,000 a month in October and November.

Investors took that decrease as an indication the economy had bottomed out and that a recovery was now even more likely. Stocks across the market rallied, with particularly strong gains in technology.

Intel advanced 27 cents to $35.79, benefiting for a second straight session from a J.P. Morgan analyst's bullish comments that the company's business might soon improve. Intel competitor Advanced Micro Devices, which soared 18 percent Thursday in reaction to that assessment, rose another 63 cents to $20.

Wall Street also bid DaimlerChrysler higher after the automaker said its 2001 operating profit had met the lower end of its expectations. The shares gained $1.22 to $45.62.

Pharmaceutical and consumer-goods companies didn't fare as well, falling back again as investors moved into the technology sector. Merck dropped 14 cents to $58.89, while Procter & Gamble slipped 78 cents to $78.45.

The market has rallied significantly from the lows that followed the September 11 terrorist attacks, achieving levels not seen since late summer. January is historically a strong time for stocks, as the pressure from end-of-year tax selling lifts.

"Investors are looking beyond the valley of that tragic event to the peaks ahead," said Alfred E. Goldman, chief market strategist for A.G. Edwards & Sons Inc. in St. Louis.

Market watchers are encouraged, but say that caution, rather than exuberance, is the best approach for investors.

"For all intents and purposes, it does appear the recessionary forces are abating," said Bryan Piskorowski, market commentator at Prudential Securities. "These are steps in the right direction but it's still difficult to call a turn here and know when things are exactly going to improve."

Advancing issues outnumbered decliners nearly 2-to-1 on the New York Stock Exchange. Volume came to 1.87 billion shares, compared with 1.74 billion shares in the previous session.

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