Stocks surged today as Wall Street moved toward a solid one-week rebound from the devastating losses that followed the terrorist attacks on the World Trade Center and the Pentagon.
Although investors were still worried about the economy, especially since third-quarter earnings reports are coming up, the market appeared poised to recover as much of a third of its loss last week, when the Dow Jones industrials fell 1,369.
At 1 p.m., the Dow was up 151.40 at 8,832.82, extending a 114-point advance Thursday.
Broader indexes also rose. The Nasdaq composite index gained 34.28 to 1,494.99, while the Standard & Poor's 500 index rose 19.31 to 1,037.92.
"Some are saying that we are going to have a really awful earnings period but the market knows that," said Tobias Levkovich, an equity strategist at Salomon Smith Barney. Some of the damage to profits has been priced in as the Standard & Poor's 500 has fallen 6.2 percent since the attack.
Even with its 7.1 percent gain this week, the S&P 500 is on track to end the third quarter with a 16 percent loss, its worst performance since the fourth quarter of 1987. The Dow, up 6.9 percent in the past five days, is 17 percent lower this quarter. The Nasdaq has climbed 4 percent this week and fallen 31 percent this quarter.
Today was the last trading day of the third quarter. Such days can be volatile as fund managers adjust their portfolios but at least in early trading, the market moved consistently higher.
"You might have some mutual funds putting cash to work before the quarter ends," said John Forelli, portfolio manager for John Hancock Core Value Fund.
Exelon rose 33 cents to $44.83 despite lowering its third-quarter and full-year earnings outlook. The utility is also cutting 450 jobs.
Investors also bid the Bank of New York higher, up $1.69 to $35.01, although it warned it won't hit third-quarter earnings targets because of the attacks on the World Trade Center.
Boeing fell $1.40 to $33 on ongoing worries
the aircraft manufacturer will be hurt by Americans' fear to fly in the aftermath of the terrorist attacks.
Cendant Corp. climbed after forecasting that slower sales at its hotel and rental car businesses after the attacks will cut just a penny off quarterly profit, a reduction more than reflected in its stock price.
American Express, the No. 1 provider of travel services and No. 4 U.S. issuer or credit cards, rose $1.52 to $28.98, though it is still 17 percent lower since the attack. Honeywell, which makes commercial aircraft control systems, jumped $1.27 to $26.32. It's down 27 percent over the last two weeks.
Cisco Systems advanced 50 cents to $11.74. Among other active Nasdaq stocks in early trading, Sun Microsystems rose 24 cents to $8.15 and Dell Computer climbed 37 cents to $18.41.
Delta gained 53 cents to $24.89.
AMR advanced 63 cents to $18.53 after Salomon Smith Barney analyst Brian Harris said airlines will rally next year as reductions in capacity and a "steady revenue recovery" boosts profits. Harris raised his rating on AMR to "buy" from "neutral."
Praxair, which supplies coatings and repair services for aircraft engines, rose 37 cents to $41.64. The company said it will cut 900 jobs and miss profit forecasts because demand from the aviation industry has declined.
United Parcel Service rose $1.09 to $50.81 after saying its third-quarter profit may be as much as 18 percent less than forecast. The biggest package delivery company said its package volume fell more than 10 percent in the week after the attack.
Eaton Corp., the second-largest maker of hydraulic equipment, said it expects operating profit for the rest of this year and next year to miss analysts' estimates because of slowing demand for industrial equipment following the terrorist attacks. Eaton fell 82 cents to $58.80.
While insurance companies may be liable for more than $30 billion in claims from the destruction of the World Trade Center and related disruptions, investors have come to believe the attack will boost insurance premiums.
The S&P Insurance Composite Index of 20 stocks fell almost 12 percent last week, as stock trading resumed following the four-day halt caused by the attack. By yesterday's close, the index had erased that decline, and it added another 0.4 percent today.
American International Group toy gained 87 cents to $76.87, its fifth straight gain after falling every day the week before. It is 3.5 percent higher since the attack. Berkshire Hathaway gained $1050 to $70,800, and Chubb Corp. gained 67 cents to $70.65.
Money managers may have "raised cash in anticipation of redemptions and it looks like they're trying to put some of that back into the market," said Jim Luke, who manages the $175 million BB&T Large Company Growth Fund in Raleigh, N.C.