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The Honolulu Advertiser

Posted on: Tuesday, December 23, 2003

Stocks edge up despite heightened terror alert

By Hope Yen
Associated Press

market chart
NEW YORK — Wall Street pushed to new 52-week highs yesterday as investors cautiously picked up shares on expectations of stronger growth in 2004. A raised terror alert limited gains.

Trading was choppy and light as many investors got an early start on the Christmas holiday. The stock market will be open for a half session tomorrow, closed on Christmas and have a half session Friday.

"There's a little bit of caution given the security alert," said Russ Koesterich, U.S. equity strategist at State Street Corp. in Boston. "That might be holding back what normally would be some follow through from last week's gains."

The Dow Jones industrial average closed up 59.78, or 0.6 percent, at 10,338.00, having advanced 2.4 percent last week to notch its fourth straight week of gains. Yesterday, the blue-chip average rose to its highest level since May 17, 2002, when it stood at 10,353.08. The broader market also rose.

On Sunday, the government raised the national terror level to orange. Homeland Security chief Tom Ridge said threat indicators are "perhaps greater now than at any point" since the Sept. 11 attacks.

Stocks typically climb at the end of December and beginning of January as investors put year-end bonuses and dividends to work on optimism for the new year. But analysts have wondered whether the so-called Santa Claus rally would happen given this year's solid gains.

Since hitting a low on March 11, the Dow is up 37 percent, the Nasdaq has risen 54 percent and the S&P has gained about 37 percent.

Advancing issues outnumbered decliners about 9 to 5 on the New York Stock Exchange. Consolidated volume came to 1.59 billion shares, compared with 2.06 billion traded Friday.

The Russell 2000 index, a barometer of smaller company stocks, rose 2.49, or 0.5 percent, to 549.37.

In Europe, Britain's FTSE 100 rose 0.3 percent, France's CAC-40 fell 0.2 percent, and Germany's DAX index declined 0.6 percent.