- The Washington Times - Thursday, May 23, 2002

NEW YORK (AP) Stocks fluctuated throughout an uncertain session yesterday, dropping amid fears of terrorist attacks and then turning mostly higher late in the day on rumors that Osama bin Laden had been captured.
The market, worried about the possibility of more terrorism, was on its way to its third straight decline before the unconfirmed rumors.
"There were some rumblings that the U.S. military may have captured bin Laden. That caused some buying late in the day," said Todd Clark, head of listed equity trading at Wells Fargo Securities. "When you have volume so light, it's not hard for the market to move."
Trading was indeed light amid the uneasiness over warnings from the FBI and Vice President Richard B. Cheney each of the past three days.
The Dow Jones Industrial Average closed up 52.17, or 0.5 percent, at 10,157.88. But the advance was moderate compared with the Dow's 247-point loss over the previous two sessions.
The broader market also managed late gains. The Nasdaq Composite Index rose 9.27, or 0.6 percent, to 1,673.45, having dropped 77.21 Monday and Tuesday.
The Standard & Poor's 500 index gained 6.14, or 0.6 percent, to 1,086.02.
Yesterday marked the market's first winning day in three sessions, but it was mild compared with the jumps the market enjoyed last week when the Nasdaq gained 8.8 percent for the week and the Dow rose 4.2 percent.
Still, analysts weren't holding much hope that the market would make much, if any, upward progress this week and believed selling could continue to dominate as investors play it safe ahead of the long Memorial Day weekend. Some of the recent terror warnings are pegged to the weekend.
"Emotions are running high. It's a reminder of the disruption that a terrorist strike can cause not only to the public, in loss of life, but its effects on the economy," said Barry Hyman, chief investment strategist at Ehrenkrantz King Nussbaum.
Mr. Hyman said the prospect of terrorism is "a reminder of the risk profile that we as investors have to put into a market … that is not cheap and still has nagging earnings concerns ahead of it."
Ford advanced 61 cents to $18.19 after Banc of America raised its rating to "buy" from "market perform."
Johnson & Johnson rose $1.36 to $62 after releasing data showing that its new drug-coated stent is effective. Additionally Merrill Lynch reiterated its "strong buy" rating on the Dow stock.
Grocery chain Albertson's advanced $1.91 to $34.06 after raising its first-quarter outlook.
Dell Computer rose 52 cents to $27.40. Although Merrill Lynch reiterated its "strong buy" rating on Dell, shares were lower for most of yesterday.
Among the biggest losers, Gap dropped $2.45, or 15.3 percent, to $13.55, after President Millard "Mickey" Drexler on Tuesday announced plans to retire as chief executive officer, a move that raised new questions about the future of the troubled retailer. Additionally, Merrill Lynch lowered its near-term rating on Gap shares to "neutral" from "strong buy."
Dow industrial Home Depot fell 65 cents to $44.25, after beating earnings expectations on Tuesday, but indicating it is cautious about the future of the home-improvement industry.
Advancing issues barely outnumbered decliners on the New York Stock Exchange. Consolidated volume was light at 1.39 billion shares, below Tuesday's 1.47 billion.
The Russell 2000 index, which tracks smaller-company stocks, fell 1.55, or 0.3 percent, to 493.91.
Overseas, Japan's Nikkei stock average finished yesterday up 1.4 percent. In Europe, France's CAC-40 sank 1.7 percent, Britain's FTSE 100 fell 0.9 percent, and Germany's DAX index declined 1.3 percent.

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