- The Washington Times - Monday, January 31, 2005

NEW YORK (AP) — Successful elections in Iraq and a bevy of merger and acquisition deals pushed stocks higher yesterday in moderately heavy trading, with beaten-down tech stocks making the biggest gains.

The success of the Iraqi elections, despite attacks on 38 of the nation’s voting centers, along with OPEC’s decision to maintain current oil production levels, removed a pair of obstacles that had prevented many investors from getting into the market.

The news out of the Middle East failed to halt rising oil prices, however, with a barrel of light crude settling at $48.20, up $1.02, on the New York Mercantile Exchange.

The flurry of new deals, meanwhile, showed corporate America’s confidence in the economy, which further cheered Wall Street. Among the deals announced yesterday, MetLife Inc. said it would purchase Citigroup Inc.’s Travelers Life & Annuity division for $11.5 billion.

“Not a bad Monday to wake up to,” said Jay Suskind, head trader at Ryan Beck & Co. “We’ve had a lot of positive catalysts here, and I think people are seeing that January has been very oversold. So we’re moving forward, and the market is now focused back on growth and earnings.”

The Dow Jones Industrial Average closed up 62.74, or 0.6 percent, to 10,489.94.

Broader stock indicators rose substantially. The Standard & Poor’s 500 index was up 9.91, or 0.85 percent, at 1,181.27, and the Nasdaq Composite Index gained 26.58, or 1.31 percent, to 2,062.41.

Yesterday’s move higher was actually less than many analysts had expected, given the success in Iraq and the wave of merger deals. But a handful of issues remain for Wall Street in the week ahead, including the Federal Reserve’s decision on the nation’s benchmark interest rate, due tomorrow, and Friday’s job creation report from the Labor Department. By the end of the week, investors are likely to have a very clear picture of the economy and can invest with more confidence, analysts said.

“It’s an extremely important, even critical, week for the markets,” said Hugh Johnson, chief investment officer at First Albany Corp. “This week will set the tone for February and March.”

While Wall Street ended January on a high note, the overall month was very disappointing, coming on the heels of strong gains in November and December. Anxiety over interest rates, inflation, oil prices and Iraq pressured stocks and kept many investors on the sidelines. For the month, the Dow fell 2.72 percent, the S&P; 500 dropped 2.53 percent, and the Nasdaq slumped 5.2 percent.

In economic news, personal incomes rose by 3.7 percent in December, according to the Commerce Department, up from 0.4 percent in November. Much of that gain was attributed to Microsoft Corp.’s special $3-per-share dividend paid out Dec. 2, which pumped $32 billion into the economy.

New home sales rose 8.9 percent in December to an annualized 1.098 million homes, better than November’s 12.1 percent drop, but less than the 1.2 million home sales expected on Wall Street.

With the acquisition of Travelers, MetLife is poised to become the largest individual life insurer in North America, while giving Citigroup a stake in MetLife and a large infusion of cash. MetLife fell 19 cents to $39.75, while Citigroup added 67 cents to $49.05.

Dow component SBC Communications Inc. added 14 cents to $23.76 after finalizing its $16 billion agreement to acquire former parent AT&T; Corp. AT&T; skidded 52 cents to $19.19.

Time Warner Inc. and Comcast Corp. have joined forces to make a $15 billion bid for bankrupt Adelphia Communications Corp., according to news reports. The offer is short of the $17.5 billion Adelphia reportedly had sought. Time Warner edged 7 cents higher to $18, while Comcast lost 20 cents to $31.61.

Iowa-based newspaper publisher Lee Enterprises Inc. gained 64 cents to $44.55 after it agreed to buy Pulitzer Inc. for $1.46 billion in stock. Pulitzer, slated to become a Lee subsidiary, climbed 55 cents to $63.45 on the news.

Advancing issues outnumbered decliners by more than 3 to 1 on the New York Stock Exchange.

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide