Posted on: Wednesday, February 2, 2005
Stocks rise, but buyers hesitating until Fed acts
By Meg Richards
Associated Press
NEW YORK — Stocks moved higher yesterday as strong earnings and a drop in oil prices offset the impact of lower-than-expected manufacturing activity and apprehension about the Federal Reserve's impending decision on rates.
"I think what we've got here is a market that looks like it's on the mend," said Philip Dow, managing director of equity strategy at Dain Rauscher Wessels in Minneapolis. "To me, you can only say the surprises in the economy and in earnings have been positive this year."
The Dow Jones industrial average closed up 62.00, or 0.59 percent, at 10,551.94. The Standard & Poor's 500 index rose 8.14, or 0.69 percent, to 1,189.41. The Nasdaq composite index added 6.29, or 0.31 percent, to 2,068.70. Advancers outnumbered decliners by about 2 to 1 on the New York Stock Exchange.
Economists were somewhat disappointed that although the Institute for Supply Management's index of manufacturing activity affirmed the rebound at the nations' factories, it was not at the pace economists expected. The reading came in at 56.4, down from a revised 57.3 in December, and under forecasts of 57.
Wall Street expects the Fed's Open Market Committee to raise short-term interest rates by another 0.25 percentage point at the conclusion of its two-day meeting today. The statement that accompanies the decision will also be closely examined for clues to what lies ahead. Worry about the Fed meeting kept some investors on the sidelines, but trading was still brisk — a fact analysts found encouraging after January's steep declines.
