- The Washington Times - Thursday, March 8, 2007

NEW YORK (AP) — Wall Street extended its recovery from last week’s big plunge, rising yesterday after several stable sessions helped buttress investor sentiment and allay some concerns about the economy.

Yesterday’s advance helped investors speed past lackluster retail-sales figures and focus on more promising comments about March sales. Investors also grew more confident following gains in markets in Europe and Asia. The dollar was mixed against major currencies and fought its way higher against the yen, easing some concern about whether global liquidity would tighten.

Investors eager for signals about the health of the economy bet on rising fortunes for U.S. businesses a day ahead of the Labor Department’s much-anticipated February employment report.

“I think we got a little bit too negative too fast,” said Brian Levitt, economist at OppenheimerFunds Inc. “They failed to see the broader picture that there still is fairly good underlying strength in the economy.”

The Dow Jones Industrial Average was up more than 100 points in afternoon trading before pulling back amid rumors a subprime lender would declare bankruptcy. The Dow closed up 68.25, or 0.56 percent, at 12,260.70.

Lender New Century Financial Corp. announced after the markets closed that it would no longer be accepting loan applications, and that it secured $265 million in financing to help it meet financial obligations.

“This is one of the fears that has kind of been overhanging the market,” said Larry Peruzzi, senior equity trader at Boston Company Asset Management.

Broader stock indicators also put up sizable gains yesterday. The Standard & Poor’s 500 Index climbed 9.92, or 0.71 percent, to 1,401.89, and the Nasdaq Composite Index advanced 13.09, or 0.55 percent, to 2,387.73. The Russell 2000 Index of smaller companies rose 5.24, or 0.68 percent, to 781.14.

Bonds fell as stocks advanced; the yield on the benchmark 10-year Treasury note rose to 4.51 percent from 4.50 percent late Wednesday. Gold prices rose.

Light, sweet crude fell 18 cents to $61.64 per barrel on the New York Mercantile Exchange.

The focus on broader market sentiment and the impending February employment report overshadowed word from the Labor Department that the number of newly laid-off workers seeking unemployment benefits fell last week to the lowest level in a month.

Investors should remain vigilant, Mr. Levitt says.

“I think we are still going to see some volatility. Investors need to focus on keeping the risks in their portfolio in check. There are good opportunities around the world but certainly it is a good time to think about quality.”

The major indexes did show some volatility amid speculation New Century would make some kind of announcement. The stock, which dropped below a 52-week low of $3.94 to as low as $3.37 before rebounding somewhat, fell $1.29, or 25 percent, to $3.87.

Also yesterday, hedge fund Greenlight Capital founder David Einhorn, 38, resigned from New Century’s board, according to a regulatory filing that didn’t give a reason.

Nonetheless, investors seemed able to look past some unpleasant news from retailers. Wal-Mart’s same-store sales, or sales at stores open at least a year, rose a lower-than-expected 0.9 percent in February. Wall Street had been looking for sales to increase 1.5 percent. Wal-Mart fell 5 cents to $47.88.

Nordstrom rose $2.26, or 4.5 percent, to $52.68 after its February same-store sales jumped 9.1 percent, well above the expected 5.7 percent increase.

Same-store sales are a key measure of a retailer’s performance and a strong report Wednesday from luxury department store chain Saks Inc. fanned Wall Street’s expectations for Saks’ competitors. Saks, after rising Wednesday, advanced 12 cents to $19.94.

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

The Nikkei rose 1.94 percent, Hong Kong’s Hang Seng Index added 1.36 percent, and the sometimes-volatile Shanghai Composite Exchange rose 1.08 percent. It was a nearly 9 percent drop in Shanghai on Feb. 27 that helped ignite a worldwide spasm of selling.

In Europe, stocks added to gains after the U.S. markets advanced. Britain’s FTSE 100 closed up 1.16 percent, Germany’s DAX index added 1.44 percent, and France’s CAC-40 advanced 1.27 percent.


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