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Posted at 12:12 p.m., Thursday, October 9, 2003

Stocks up and upbeat a year after low point

Hawai'i Stocks
Updated Market Chart

By Meg Richards
Associated Press

NEW YORK — Powered by a streak of upbeat earnings and economic news, Wall Street surged higher today, completing a remarkable 12 months that saw the major indexes make a stunning rebound from the depths of the three-year-long bear market.

As of today’s close, the Nasdaq composite index had recovered an impressive 71.6 percent of its value since Oct. 9, 2002, while the Dow Jones industrials were up 32.9 percent and the Standard & Poor’s 500 index had regained 33.7 percent.

A Labor Department report suggesting the pace of layoffs has slowed fed the market’s good mood, especially after a spate of mixed economic news in recent weeks.

"Maybe the market is finally believing that this rebound we’ve been seeing is real," said Jay Suskind, head trader at Ryan Beck & Co. "If things continue to have a sunny outlook, people won’t want to miss it."

Solid retail sales reports from Wal-Mart Stores Inc., Gap Inc. and others contributed to the market’s positive tone, said Jeff Swensen, senior trader at John Hancock Funds.

According to preliminary data, the Nasdaq rose 18.12, or 1 percent, to close at 1,911.90.

The Nasdaq, the most battered of the market’s major indexes during Wall Street’s three-year slump, last closed higher 19 months ago, on March 11, 2002, at 1,929.49.

A year ago, on Oct. 9, 2002, the Nasdaq was at a six-year low of 1,114.11.

The Dow advanced 49.11 today, 0.5 percent, to 9,680.01 — its highest close since since June 18, 2002, when the average was at 9,706.12. On Oct. 9 of last year, the Dow stood at a five-year low of 7,286.27.

The S&P 500 index rose 4.95, or 0.5 percent, to 1,038.73. A year ago, the S&P 500 had fallen to a six-year low of 776.76.

Analysts said the reported decline in the pace of layoffs could signal companies are more hopeful about the staying power of the economic recovery.

But investors are also focused on third-quarter earnings reports, looking for solid evidence from companies that the economy is improving. Trading volume has been light as many investors wait for the bulk of the reports, expected over the next two weeks.

In results issued after the market closed yesterday, biotechnology company Genentech Inc. and Internet search engine Yahoo! each reported strong earnings, beating expectations.

Genentech saw a 70 percent jump in profits on strong sales of two cancer-fighting drugs and a one-time legal settlement. Genentech was up $3.23, or 4.1 percent, at $81.98 today.

Yahoo doubled its earnings with strong revenue from advertising sales. Yahoo was up $3.96, or 10.2 percent, at $42.75.

Computer Associates International Inc. was down $3.01, or 10.4 percent at $25.95 on news the firm had fired three top financial executives in the midst of a government accounting probe. The company said the three had inappropriately recognized sales in advance of signed contracts.

Advancing issues outnumbered decliners 3 to 2 on the New York Stock Exchange. Volume was moderate.