Posted on: Tuesday, February 1, 2005
Mergers, Iraq vote give momentum to stocks
By Michael J. Martinez
Associated Press
NEW YORK — Successful elections in Iraq and a bevy of merger and acquisition deals pushed stocks higher yesterday in moderately heavy trading, with beaten-down tech stocks enjoying the largest gains.
"Not a bad Monday to wake up to," said Jay Suskind, head trader at Ryan Beck & Co. "We've had a lot of positive catalysts here, and I think people are seeing that January has been very oversold. So ... the market is now focused back on growth and earnings."
The Dow Jones industrial average closed up 62.74, or 0.6 percent, to 10,489.94. The Standard & Poor's 500 index was up 9.91, or 0.85 percent, at 1,181.27, and the Nasdaq composite gained 26.58, or 1.31 percent, to 2,062.41. Advancing issues outnumbered decliners by more than 3 to 1 on the New York Stock Exchange.
Yesterday's move higher was actually less than many analysts had expected, given the success in Iraq and the merger deals. But a handful of issues remain in the week ahead, including the Federal Reserve's decision tomorrow on the nation's benchmark interest rate, and Friday's job-creation report. "It's an extremely important, even critical, week for the markets," said Hugh Johnson, chief investment officer at First Albany Corp. "This week will set the tone for February and March."
The success of the Iraqi elections and OPEC's decision to maintain current oil production levels, removed a pair of obstacles that had prevented many investors from getting into the market. The flurry of new deals, meanwhile, showed corporate confidence in the economy. Among the deals announced yesterday, Metlife Inc. said it will purchase Citigroup Inc.'s Travelers Life & Annuity division for $11.5 billion.
