America's leading stock markets got off to a promising start in 2002. The major stock averages all gained for the first three days of the new year.
A lot of New York City is still in holiday mode. Not much news is being generated, as even a new administration in City Hall eases into office.
However, Wall Street snapped back to business on January 2, with some positive results after three trading sessions. The Dow Jones Industrial Average moved over two percent higher. The tech-weighted Nasdaq composite gained more than five percent. The Standard & Poor's 500 index, a broader measure of the stock market, is up abut two percent.
The major stock averages are coming off two consecutive years of losses. Their early showing in 2002 may be encouraging. But the market's behavior for the year depends a lot on how fast the U.S. economy recovers from a steep downturn.
The market got a boost Friday from the latest jobs report, showing that fewer Americans lost jobs in December than in the prior three months. Jim Glassman, a senior economist for the JP Morgan Chase investment bank, was upbeat. "You know folks are still losing jobs. But there are some promising signs here that added to other signs we're seeing that the economy may be stabilizing and it's beginning to look like we're looking at a recovery not many months down the road. And that's what the market has been smelling," he said. "Frankly, I think it's amazing that we can be here on January fourth and be talking about this, given the tremendous threat we faced back in September."
Other experts caution, however, that nothing is certain at this point. Wall Street soon will be looking at fourth quarter earnings results, and maybe more profit warnings from U.S. corporations, at least for the first half of the year.
The technology sector, for one, is not expected to have a robust recovery. High-tech companies are still reeling from several years of excessive growth that could not keep pace as the economy slowed.
But it was a good start for the stock market, and Wall Street closed its first week of the new year with a grateful sigh.