Stocks gain despite war fears - East Valley Tribune: Business

Stocks gain despite war fears

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Posted: Tuesday, February 25, 2003 2:09 pm | Updated: 2:21 pm, Thu Oct 6, 2011.

NEW YORK - Wall Street shrugged off a discouraging consumer confidence report Tuesday and sent stocks modestly higher as investors placed bets after several days of declines.

But trading was choppy as fears about war and the economy still dominated trading. The Dow Jones industrials fell as much as 138 points to a fresh four-year low before staging a late-day rally on bargain hunting.

Analysts downplayed the comeback.

“I’d be hard-pressed to say we’re in a brave new world,’’ said Bryan Piskorowski, market commentator at Prudential Securities. “The market the last few days has been underloved and oversold, so we were due for a bounce.’’

The Dow rose 51.26, or 0.7 percent, to close at 7,909.50, having declined 159 points Monday, its biggest one-day loss in nearly a month.

The broader market also finished higher. The Nasdaq composite index gained 6.60, or 0.5 percent, to 1,328.98. The Standard & Poor’s 500 index rose 5.99, or 0.7 percent, to 838.57.

The New York-based Conference Board said its Consumer Confidence Index plummeted to 64.0 in February from a revised 78.8 in January. The reading fell far below analysts’ estimate of 77.0, and is the lowest since the index hit 60.5 in October 1993.

An encouraging housing report, meanwhile, helped lift the market.

The National Association of Realtors reported existing home sales surged to a record monthly high in January at a seasonally adjusted annual rate of 6.09 million. That represented a strong 3 percent gain from December’s level and defied analysts’ expectations of a decrease.

Analysts say they expect trading to be uneven in the coming weeks as investors worry about threats of war and terrorism. While stocks have fallen recently to four-month lows, Wall Street has also seen gains on bargain hunting.

On Tuesday, Iraq’s Deputy Prime Minister Tariq Aziz said no decision had been made on a U.N. order to destroy banned weapons a day after Saddam Hussein indicated in a CBS interview he will refuse to obey it.

The United States, Britain and Spain are pushing for a U.N. Security Council vote against Iraq shortly after a March 7 report from chief inspectors Hans Blix and Mohamed ElBaradei; France, Germany and Russia have circulated a counterproposal for disarmament.

And in North Korea, a missile was launched Monday, crashing into the sea between the Korean Peninsula and Japan. U.S. officials later downplayed the launch as an innocuous test.

H&R Block climbed $1.31 to $38.51 after the biggest tax preparer in the country reported quarterly earnings that beat analysts’ expectations.

Home improvement retailer Home Depot rose 66 cents to $22.84 after reporting fourth-quarter profits that beat Wall Street’s estimates by 3 cents a share.

Losers included DuPont, which declined 57 cents to $36.30, and Honeywell International, which lost 39 cents to $23.

American Eagle Outfitters dropped 40 cents to $14.86 after the clothing retailer reported fourth-quarter profits that beat estimates by a penny; however, it also cautioned that February same-store sales, those from stores open at least a year, might be lower than expected due to the severe winter weather.

Advancing issues outnumbered decliners about 4 to 3 on the New York Stock Exchange. Volume was light at 1.47 billion shares, compared with 1.22 billion traded Monday.

The Russell 2000 index, which tracks smaller company stocks, rose 2.98, or 0.8 percent, to 361.20.

Overseas, Japan’s Nikkei stock average finished 2.4 percent lower Tuesday. In Europe, France’s CAC-40 dropped 3.7 percent, Britain’s FTSE 100 declined 2.2 percent and Germany’s DAX index slid 3.3 percent.

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