NEW YORK (AP) — Wall Street managed a moderate gain in the final session of a dismal first quarter yesterday, but stock prices and the major indexes ended the first three months of the year with massive losses, the casualties of the continuing credit crisis.
The Standard & Poor’s 500 Index, the benchmark for many widely held investments such as mutual funds, sustained a loss for the quarter of nearly 10 percent, the worst since the third quarter of 2002, when it fell nearly 18 percent.
The upward blip yesterday was the result of a better-than-expected reading in the Chicago Purchasing Managers Index, which is considered a precursor to the Institute for Supply Management’s manufacturing survey today. The index rose to 48.2 in March from 44.5 a month earlier; economists had been expecting a reading of 47.3, according to Dow Jones Newswires. Though the number topped forecasts, a figure below 50 indicates a contraction in manufacturing activity.
The market’s reaction likely was not as enthusiastic as it might seem from yesterday’s gains by the major indexes. Volume was light, which tends to skew price movements.
It was a difficult quarter on Wall Street, with financial companies’ ongoing credit market losses and the flagging economy curbing investor appetites for stocks. Although the market posted several up days during the quarter, the overall trend was sharply lower, with reports of asset write-downs and shaky financial companies pummeling the market — in particular, the near-collapse of Bear Stearns.
Investors didn’t have a strong reaction yesterday to a government plan to overhaul the way Wall Street is regulated. The plan would give the Federal Reserve increased power to protect the stability of the entire financial system while merging day-to-day supervision of banks into one agency, down from five under the existing system.
Scott Wren, senior equity strategist for A.G. Edwards, said many investors appeared to be awaiting economic data due this week on the manufacturing and service sectors as well as employment. Investors are prepared for weak economic data, he said, but could be unnerved by unwelcome corporate news.
“The market is already pricing in a ton of bad economic news. Bad economic news is not going to drive the market. What’s going to drive the market is headline news,” he said.
On the last day of the quarter, the Dow Jones Industrial Average rose 46.49, or 0.38 percent, to 12,262.89.
The S&P 500 Index advanced 7.48, or 0.57 percent, to 1,322.70, and the Nasdaq Composite Index rose 17.92, or 0.79 percent, to 2,279.10.
For the quarter, the Dow fell 7.55 percent, the victim of a series of triple-digit plunges. The S&P 500 declined 9.92 percent, while the Nasdaq, whose smaller company stocks are seen as more vulnerable to economic problems, fell 14.07 percent.
Advancing issues outnumbered decliners by about 3-to-2 on the New York Stock Exchange, where volume came to 1.58 billion shares compared with 1.35 billion shares traded Friday.
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