Nasdaq hits highest level since July 2001
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By Seth Sutel
Associated Press
NEW YORK — More signs of the improving business climate — better-than-expected holiday sales and Nokia Corp.'s latest fourth-quarter outlook — sent stocks moderately higher today. The advance carried the Nasdaq composite index to its first close above 2,100 in 2 1/2 years.
The positive corporate news overshadowed a relatively poor reading on the job market, leading investors to put aside trepidation that had been building this week about tomorrowâs report on employment, which could set the tone for sentiment about the economy in coming days.
"It seems that the good earnings news forced people into the market and overshadowed the jobless data," said Todd Clark, head of listed equity trading at Wells Fargo Securities.
According to preliminary calculations, the Nasdaq advanced 22.57 or 1.1 percent, to 2,100.25, the first time it closed above 2,100 since July 3, 2001.
The Dow Jones industrial average closed up 63.41, or 0.6 percent, at 10,592.44, its highest close since March 2002.
The Standard & Poorâs 500 index rose 5.59, or 0.5 percent, to 1,131.92, its highest close since April 2002.
"The money flows into the market are very positive, and volume has been strong," Clark said. "Barring a disaster tomorrow, I donât see how we couldnât be looking at more rises in prices."
Major retailers gave a boost to market sentiment before the opening bell with a series of reports showing higher same-store sales in December, thanks to a late surge of holiday season spending.
TJX Cos., operator of T.J. Maxx and Marshalls, rose 58 cents to $22.16 after reporting a 4 percent rise in same-store sales. The company said foreign exchange gains also bolstered its results.
Sears, Roebuck and Co. was up $1.21 at $46.19 after reporting sales that were down just 0.6 percent for its domestic business, a smaller decline than analysts had been expecting.
Telecommunications stocks advanced strongly on upbeat outlooks and a surprise announcement Finnish cell phone maker Nokia, which sharply raised its estimates for fourth quarter earnings.
Nokia surged $2.50 to $20.47 in heavy trading, and shares in other makers of telecommunications equipment were also higher.
That sector got another lift today by an announcement from Verizon that it would invest $3 billion in networks over the next two years to bring broadband services to the mass market. Verizon was up 56 cents at $37.12.
Dow component Hewlett-Packard Co. rose $1.33 to $24.69 after The Wall Street Journal reported that the tech giant plans to list its shares on both the Nasdaq as well as the New York Stock Exchange.
Jeff Swensen, a senior trader at John Hancock Funds in Boston, said the positive news from Nokia combined with the stronger reports on retail sales were raising hopes that the upcoming earnings season would yield more good news on corporate profits.
"We built some positive momentum off the news from Nokia," Swensen said. "The important thing was we were able to rally on Monday and keep up the momentum. Weâre expecting a good earnings season and more good readings on the economy."
The Labor Department reported new claims for unemployment benefits increased last week following three straight weeks of declines, but the news wasnât bad enough to stifle optimism on the stock market.
New applications filed for unemployment insurance rose to 353,000, an increase of 14,000 for the week ending Jan. 3. That level of new applications in the previous week was the lowest since January 2001.
