- The Washington Times - Tuesday, September 28, 2004

NEW YORK (AP) — Stocks rebounded yesterday, with the Dow Jones Industrial Average rising solidly above 10,000 as investors, less anxious about volatile energy prices, focused instead on good corporate news.

Light crude for November delivery surged above the psychologically important $50 milestone early in the session, but backed off that record high after Saudi Arabia indicated it would raise its output if necessary. Nervous about rising energy costs, investors had turned to the safety of Treasury bonds lately, but with the third quarter drawing to a close and oil prices easing, they seemed ready to return to stocks — especially after several sessions of equity declines.

“All attention is definitely being paid to oil today, and the fact that it’s trading off its highs is definitely helping equities,” said Brian Williamson, an equity trader at the Boston Company Asset Management. “You can definitely make a correlation today between the bond market selling off … and the momentum in U.S. equities.”

The Dow closed up 88.86, or 0.9 percent, at 10,077.40.

The broader gauges also posted gains. The Standard & Poor’s 500 index added 6.54, or 0.6 percent, to 1,110.06. The Nasdaq Composite Index added 9.99, or 0.5 percent, to 1,869.87.

In economic news, consumer confidence declined for a second straight month, according to the Conference Board. The index fell 1.9 points to 96.8 from a revised reading of 98.7 in August. Analysts had expected a reading of 99.5. Economists blamed the decline on soft labor market conditions.

Moderating crude prices, a Saudi Arabian oil official said his country would raise its daily production by 15 percent in an effort to calm the market. The move essentially allows the world’s largest petroleum exporter to raise production at will, depending on demand.

Oil prices remained quite volatile, however, as attacks by rebels in Nigeria’s southern oil fields forced several companies to halt production and evacuate workers. Nigeria is the world’s seventh-largest crude exporter. Light, sweet crude for November delivery settled at a new high, up 26 cents at $49.90.

Uncomfortably high oil prices have dogged the equity market for months, and the major indexes all posted steep declines over the past week amid mounting worries about rising business expenses and falling consumer spending. Analysts are largely upbeat about the market’s underlying fundamentals, but given all the uncertainties surrounding energy costs, the jobs picture, the upcoming presidential election and persistent terror threat, few were convinced the upward move would last.

AtheroGenics Inc. soared 64 percent, or $14.84, to $38 on news that an interim analysis of a treatment to cut arterial plaque might help reverse the progression of heart disease.

Valero Energy Corp. gained $2.04 to $79.09 after the oil refinery operator raised its third-quarter earnings forecast.

Lowe’s Cos. gained 33 cents to $53.76 after the home-improvement retailer reiterated its earnings projections for the quarter and the year, and issued a bright forecast through 2006 based on an expectation of robust sales growth next year.

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