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US Markets Post Modest Gains - 2001-10-05

U.S. stocks showed modest gains Friday, despite some negative economic news. It was a positive week as well for Wall Street, with the major stock averages erasing more of their losses following last month's terrorist attacks.

The Dow Jones Industrial Average rose 59 points, (about .6 percent) to 9,120. The tech-weighted Nasdaq Composite Index advanced half a percent, gaining eight points and closing at 1,605. The broader Standard & Poor's 500 Index gained just under two points, ending the week at 1,071.

Overall, the Dow Industrials were up three percent for the week. The Nasdaq was seven percent higher.

The market Friday was able to shrug off some negative news that kept it under pressure most of the day. First, there were profit warnings from two technology bellwethers, networking giant Sun Microsystems and microchip maker Advanced Micro Devices.

Meanwhile, the latest on the U.S. economy shows the unemployment rate for September unchanged at 4.9 percent. But much of the data was collected before September 11. Analysts expect the jobless rate to go up sharply in the October reading.

In fact, the U.S. economy did lose nearly 200,000 jobs last month, the largest monthly increase in a decade.

It was a lot to overcome. But investors finally stepped in to give the week just a bit more on the up side. Will it continue?

Veteran market-watcher Ted Weisberg says anything is possible. But he worries about all the economic and political uncertainty investors are still dealing with. "I think there's tons of money out there and people are looking for an excuse to buy stocks," he said. "It's just what's going to give them the comfort level to make them do that. We all know that markets somehow like to climb 'walls of fear.' So it's possible the market could continue doing better, which of course would be good. But it's a confidence thing."

Most experts say investors would be better served if they kept their focus on the long-term, that is, if they buy stocks that are almost sure to climb when the economy turns around. However, as many on Wall Street know, sound advice is no guarantee of investor behavior.