Stocks Jump But Give Some Back; Dow Up 78

Traders keep track of stocks at their posts at the New York Stock Exchange as prices rose Friday, June 6, 2003. (AP Photo/David Karp)
Traders keep track of stocks at their posts at the New York Stock Exchange as prices rose Friday, June 6, 2003. (AP Photo/David Karp)

Stock prices were mostly higher Friday afternoon, but the major market gauges were below the day's highs that saw the Standard & Poor's 500 index surpass 1,000 for the first time in nearly a year and the Dow Jones industrials climb more than 170 points.

In heavy early afternoon trading, the Standard & Poor's 500 index was up 7.57, or 0.8 percent, to 993.81, having pierced the 1,000 level in earlier trading. The S&P hadn't traded above 1,000 since June 28, 2000 and has not closed above that mark since June 20. In the previous five sessions, the S&P gained 40.5.

After climbing as much as 174.58, the Dow was up 77.66, or 0.9 percent, at 9,118.96. In the previous five sessions, the Dow advanced 330.12 points and on Wednesday closed above the 9,000 mark for the first time in nearly 10 months.

But the NASDAQ composite index, which has been trading at levels not seen in just over a year, fell 4.27, or 0.3 percent, to 1,641.74.

Analysts attributed the gains partially to an announcement by Oracle that it was offering to buy rival software maker PeopleSoft. The rise also reflected investors' growing expectations that the market has hit bottom and the economy is turning around.

But investors, concerned that Wall Street had risen too high, too quickly, paused at midday to take some profits.

The S&P and Dow Jones industrials indicators were still headed for their sixth straight winning session.

"One of the drivers in today's market is the fact that Oracle is willing to do a deal and buy PeopleSoft. That puts excitement in the market and it has people talking about what other combinations might happen," said Arthur Hogan, chief market analyst at Jefferies & Co.

Investors have been bidding shares higher for nearly three months amid enthusiasm brought on by surprisingly strong first-quarter earnings, a quick end to the war in Iraq and more robust economic data.

PeopleSoft climbed $3 to $18.11 after Oracle announced it was making a $5.1 billion, $16-a-share cash offer to purchase rival business software maker. Oracle fell 30 cents to $13.06.

On Monday, PeopleSoft said it was buying rival J.D. Edwards & Co. in a stock swap then valued at $1.5 billion. In Friday's trading, J.D. Edwards rose 86 cents to $13.65.

Other gainers included Intel, which advanced 47 cents to $22.31 after Wedbush Morgan raised its rating to "buy" from "hold." On Thursday, the chipmaker released its midquarter updates, which basically met analysts' expectations.

And, McDonald's rose $1.94 to $20.93 after CIBC World Markets upgraded it to "sector perform" from "sector underperform."

Before the market opened Friday, the Labor Department reported that the nation's unemployment rate climbed 0.1 percentage point to 6.1 percent in May, the highest level in nine years, as businesses cut 17,000 jobs. Analysts had predicted job losses of about 30,000 but considered the overall report as basically in line with their expectations.

Advancing issues outnumbered decliners about 8 to 5 on the New York Stock Exchange. Volume was heavy.

The Russell 2000 index, the barometer of smaller company stocks, rose 4.68, or 1 percent, to 455.91.

Overseas, Japan's Nikkei stock average finished Friday up 1.5 percent. In Europe, France's CAC-40 climbed 2 percent, Britain's FTSE 100 rose 1.1 percent and Germany's DAX index soared 2.4 percent.


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