- The Washington Times - Tuesday, March 1, 2005

NEW YORK (AP) — Falling oil prices and a broker upgrade of the semiconductor sector pushed stocks higher yesterday, enticing buyers back into the market after the previous session’s losses.

Technology shares climbed as both J.P. Morgan Securities and Lehman Brothers upgraded the chip sector. Morgan cited “a more bullish view” of the industry. Technology shares have lagged as other stocks moved up last month, and investors greeted the news as a sign that the recovery was finally spreading to the tech sector.

A drop in oil prices helped feed buying in stocks, as investors hoped that crude futures would not exceed $52 per barrel. Light, sweet crude for April delivery fell 7 cents to $51.68 a barrel on the New York Mercantile Exchange.

“With oil lower, you’re seeing the market move broader, moving out of energy stocks and into everything else,” said Jay Suskind, head trader at Ryan Beck & Co. “Just across the board, there’s a sense the market wants to move higher this spring.”

The Dow Jones Industrial Average rose 63.77, or 0.59 percent, to 10,830.00.

Broader stock indicators also closed higher. The Standard & Poor’s 500 index was up 6.81, or 0.57 percent, at 1,210.41, and the Nasdaq Composite Index gained 19.53, or 0.95 percent, to 2,071.25.

Investors were disappointed with the Institute for Supply Management’s manufacturing index for February, which came in at 55.3, lower than the reading of 57 economists had expected and down from January’s 56.4. However, those fearing inflation could see the report as good news, because a slide in demand for industrial goods bodes well for lower prices.

Some investors awaited Federal Reserve Chairman Alan Greenspan’s testimony before the House Budget Committee today, hoping that his assessment of the economy will boost stocks further.

“I think we’re doing pretty well here, but we’ll see what Greenspan says tomorrow,” Bill Groenveld, head trader for v Finance Investments, said yesterday. “Ideally, that could help us break through our highs for the year.”

The dollar gained ground against the euro and other major currencies, with traders expecting Mr. Greenspan to argue before Congress for a stronger dollar. Gold prices fell, and bonds turned bearish toward the end of the session, with the yield on the 10-year Treasury note settling at 4.38 percent.

The chip sector upgrades boosted several semiconductor stocks. Dow component Intel Corp. rose 63 cents to $24.62, Texas Instruments Inc. was up 68 cents at $27.15, and National Semiconductor Corp. climbed 70 cents to $20.65.

Qwest Communications International Inc. continued to press its case for an $8 billion merger with MCI Inc., which already has agreed to a $6.7 million takeover by Verizon Communications Inc. Qwest executives said up to 15,000 jobs would be cut with its proposal, more than double the job cuts projected in the Verizon deal. Qwest rose 15 cents to $4.05; MCI gained 61 cents to $23.36; Verizon added 28 cents to $36.25.

In earnings news, Marsh & McLennan Cos. Inc. gained 35 cents to $33, even after the embattled insurer swung to a loss for the latest quarter because of cost cutting and a settlement with New York’s attorney general for improper business practices. The company also said it would lay off up to 2,500 workers.

BJ’s Wholesale Club Inc. said a lease accounting adjustment ate into its quarterly profits, which fell 4.4 percent from a year ago, but the discount retailer still managed to beat Wall Street expectations by 2 cents per share after one-time charges. BJ’s climbed 8.6 percent, or $2.63, to $33.20.

Higher operating costs pushed cable operator Charter Communications Inc. to a larger-than-expected fourth-quarter loss. The company missed analysts’ loss forecasts by 19 cents per share. The stock shed 6 percent, or 11 cents, to $1.72.

Advancing issues outnumbered decliners by almost 2-to-1 on the New York Stock Exchange. Volume came to 1.71 billion shares, compared with 1.8 billion traded Monday.

The Russell 2000 index of smaller companies was up 4.47, or 0.71 percent, at 638.53.

Overseas, Japan’s Nikkei stock average rose 0.34 percent. In Europe, France’s CAC-40 climbed 0.69 percent, Britain’s FTSE 100 closed up 0.64 percent, and Germany’s DAX index gained 0.76 percent.

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