Posted on: Tuesday, December 21, 2004

Investor uncertainty hampers holiday rally

By Michael J. Martinez
Associated Press

NEW YORK — Wall Street's holiday rally stumbled, with stocks finishing mixed as investors worried over the strength of the pharmaceutical sector. Another merger, between a pair of regional utilities, buoyed confidence in the overall economy and pushed blue chips higher.

Pfizer Inc.'s surprise announcement Friday, in which it disclosed serious health risks in high doses of its arthritis drug Celebrex, roiled the pharmaceutical sector.

Pfizer, a Dow Jones industrial, once again took losses, while other drug stocks remained mixed.

The proposed $12 billion deal between Illinois utility Exelon Corp. and New Jersey utility Public Service Enterprise Group Inc. gave investors reason to be confident. That led analysts to conclude that Wall Street's year-end rally still had momentum.

A drop in crude oil futures, which retreated after last week's large gains, also fed large-cap buying.

Wall Street welcomed the latest reading from the Conference Board's index of leading economic indicators. The index, a forward-looking view of the economy, rose 0.2 percent in November, better than the 0.1 percent rise expected on Wall Street. The index had fallen 0.3 percent in October.

Some investors were betting that the good economic news would combine with Wall Street's traditional "Santa Claus" rally to produce gains through the next two weeks.

Declining issues barely outnumbered advancers on the New York Stock Exchange, where preliminary consolidated volume came to 1.83 billion shares, compared with 3.08 billion Friday.