- The Washington Times - Tuesday, January 14, 2003

NEW YORK, Jan. 14 (UPI) — Stock prices on the New York Stock Exchange and the Nasdaq Stock Market ended higher in choppy trading Tuesday, as investors digested several fresh readings on the economy.

The blue-chip Dow Jones industrial average, which added 1.09 points Monday, gained 56.64 points to close at 8,842.62. The tech-heavy Nasdaq composite index, which eased 1.68 points in the previous session, added 14.97 points to close at 1,461.01.

The broader New York Stock Exchange composite index added 24.45 points to close at 5,233.66 while the Standard & Poor's 500 index gained 5.04 to close at 931.66. The American Stock Exchange composite index gained 4.26 points to close at 830.80 while the Wilshire 5000 Index gained 47.52 points to close at 8,793.17.

Volume was 1.62 billion on the Big Board and 1.48 billion on the Nasdaq Stock Market.

Analysts said stocks inched higher as retail sales were confirmed by the government to have been unimpressive last month, something investors already picked up on following a myriad of warnings from retailers.

The Commerce Department said retail sales rose 1.2 percent in December after rising 0.9 percent in November. Excluding auto sales, however, retail sales were unchanged last month, emphasizing just how tepid the holiday-shopping season was. Economists were expecting retail sales to rise by 1.5 percent during the month and were expecting sales excluding autos to rise 0.3 percent.

Putting the dismal December behind, the Commerce Department said for all of 2002, retail sales rose 3.4 percent after rising 3.7 percent in 2001. The government said 2002 was the weakest year for retail sales since 1992, when it began keeping comparable records.

The Labor Department said the price of goods imported into the United States rose 0.7 percent in December, led higher by rising oil prices. Economists were expecting the prices of goods imported into the country to rise 0.7 percent during the month after falling 1 percent during November.

Imports, which account for about 15 percent of all goods and services purchased in the United States, rose 4.2 percent for all of 2002.

The government agency also said excluding petroleum, the gauge of the costs of goods and raw materials from abroad rose 0.1 percent after slipping 0.1 percent a month earlier.

And, the Federal Reserve Bank of Richmond said manufacturing activity held steady in December in the region, shipments edged lower but new orders grew for second month.

Manufacturing activity was relatively flat in December, though encouraging signs continued, according to results from the Richmond Fed's latest survey.

While factory shipments edged lower, the regional Fed said the volume of new orders showed modest growth for the second month. In addition, raw materials inventories barely moved from November levels, there was less weakness in orders backlogs and no change in capacity utilization. On a weaker note, however, the Fed said vendor lead-time turned negative. Also, employment conditions continued to contract at district plants, though at a more moderate pace.

Analysts noted trading activity remained sluggish as investors awaited a number of key earnings reports due out over the next few days.

Intel will kick off a busy week of earnings reports after the closing bell. Intel is expected to post fourth-quarter earnings of 14 cents a share, down from 15 cents a year earlier, according Thomson First Call.

But more closely watched will be the company's forecast, particularly after an Intel vice president was quoted in Singapore last week as saying he did not see a pickup in orders in the first half of 2003 — remarks that were later disavowed by company spokesmen in the United States.

Many analysts expect a long-overdue upgrade cycle to boost computer sales in 2003 and the Semiconductor Industry Association forecasts chip sales will increase by 20 percent.

The earnings flood hits tidal wave proportions on Thursday, with earnings from BankOne, Delta, EBay, General Motors, FleetBoston, Sears Roebuck, Sun Microsystems, United Technologies and Wachovia, among others.

Meanwhile, a full plate of economic reports remain. The Fed's Beige Book comes out Wednesday, along with the producer price index and business inventories.

Jobless claims and the consumer price index come Thursday. The week wraps up with international trade, industrial production and, importantly, consumer sentiment.

U.S. Treasury prices Tuesday pushed higher. The 10-year bond rose 10/32 to 99 11/32. Its yield, which moves in the opposite direction of its price, slipped to 4.08 percent from 4.12 percent late Monday.

In Europe, stock prices ended slightly lower in London, rose in Frankfurt and inched higher in Paris in moderate trading. The London International Stock Exchange's blue-chip FTSE-100 index eased 2.4 points to 3,945.9. The German DAX index rose 47.76 points, or 1.6 percent, to 3,108.41 and the French CAC-40 index added 4.21 points to 3,174.03.

Analysts said British stocks ended flat in range-bound trading, pressured by Wall Street's opening performance and weakness in oil and retail stocks.

German stocks came off their best levels as a rising euro and oil prices combined to pressure auto stocks.

Earlier in Asia, prices on the Tokyo Stock Exchange ended higher, lifted by bouts of bargain hunting. The blue-chip Nikkei Stock Average, which lost 27.48 points Friday, rose 82.61 points, or 1 percent, to 8,553.06 — its first gain in five sessions. Markets in Tokyo were closed Monday for a public holiday.

Analysts said stocks were lifted by bargain-hunting after last week's declines, but experts added the market's upside was limited due to uncertainty about fourth-quarter earnings by U.S. companies.

Experts said the gains came despite a surprisingly weak report on November machinery orders and the continued weakness of the dollar, which cuts into the returns of Japan's major exporters when their overseas sales are converted back into yen.

The government reported that core machinery orders slipped 0.2 percent in November from the previous month. Economists had been expecting a rise of 1.7 percent.

Elsewhere in Asia, prices ended slightly lower in moderate trading on the Hong Kong Stock Exchange. The blue-chip Hang Seng Index, which rose 112.58 points during the previous session, eased 37.77 points, or 0.4 percent, to 9,796.31.

Prices ended slightly higher on the South Korean Stock Exchange, but gains were limited due to lingering concerns over North Korea's nuclear plans. The Korea Composite Stock Price Index, or Kospi, which rose 19.52 points during the previous session, added 1.99 points, or 0.3 percent, to 650.05.

The United States, which earlier cut off food aid to North Korea, is considering helping North Korea overcome its severe energy shortages if Pyongyang abandons its nuclear weapon program. The news came after communist North Korea last Friday announced the country's withdrawal from Nuclear Non-Proliferation Treaty.

Prices inched higher on the Taiwan Stock Exchange, rising to their highest level in more than five months. The key Weighted Index, which rose 140.41 points during the previous session, added another 1.16 points, or 0.02 percent, to 4,992.42.

Meanwhile, Singapore stocks ended higher for the fifth consecutive session in moderate trading. The key Straits Times Index, which rose 38.88 points during the previous session, rose another 15.32 points, or 1.1 percent, to 1,401.37.

Elsewhere, prices ended slightly higher in light trading on the Australian Stock Exchange. The blue-chip All Ordinaries Index, which added 7.40 points during the previous session, rose 6.50 points, or 0.2 percent, to 3,049.00.




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