- The Washington Times - Monday, March 28, 2005

NEW YORK (AP) — Wall Street enjoyed a modest rebound yesterday after three weeks of losses, advancing as investors felt more optimistic about the economy and indulged in a little bargain hunting. Falling oil prices and a strengthening dollar also spurred buying.

Although Dow Jones industrial General Motors Corp. suffered from a new round of bad news, an $11.3 billion leveraged buyout of SunGard Data Systems Inc. showed that the wave of merger and acquisition activity would continue, and American International Group Inc. rebounded even as probes into its business practices continued.

The economy, however, was foremost on investors’ minds. No significant economic data were released yesterday, so the market was anxiously awaiting gross domestic product and employment numbers later in the week and hoping they would show the economy has enough strength to overcome inflation.

The Dow Jones Industrial Average rose 42.78, or 0.41 percent, to 10,485.65. The Dow has fallen more than 1 percent in each of the past three weeks.

Broader stock indicators also gained ground. The Standard & Poor’s 500 index was up 2.86, or 0.24 percent, at 1,174.28, and the Nasdaq Composite Index climbed 1.46, or 0.07 percent, to 1,992.52.

Investors also were cheered as the dollar gained ground against most major currencies, including the euro and the Japanese yen. Crude oil futures continued their slow retreat, with a barrel of light crude settling at $54.05, down 79 cents, on the New York Mercantile Exchange.

Bonds continued their slide, with the yield on the 10-year Treasury note rising to 4.64 percent, up from 4.59 percent late Thursday. Gold prices fell as the dollar gained strength.

Analysts noted that yesterday’s move up came on light volume, and the advance-decline lines showed decliners slightly ahead. Although the energy sector continued to lead the market for 2005, it was the worst performer of the month so far, despite record crude oil prices.

SunGard Data Systems Inc. rose $2.81, or 8.9 percent, to $34.36, after the company announced it would be purchased by a consortium of seven private equity groups. The move was expected, though the $5 premium over Thursday’s closing stock price was not.

GM was downgraded to “reduce” from “neutral” by UBS because of concerns over the automaker’s liquidity and questions about whether the company could continue offering dividends to its shareholders. GM slipped 93 cents to $28.37.

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