By Kate Gibson
U.S. stocks rallied Friday to lock in solid weekly gains, with the Dow Jones Industrial Average ending above the 9,000 mark for the first time since Nov. 5, as investors shelved one of the most bruising years on record to ponder moves by the new administration.
"Expectations for another big stimulus package once Barack Obama is sworn into the presidency in about three weeks' time is helping lift stocks," said analysts at Action Economics.
Up for a third consecutive session, the Dow Jones Industrial Average (DJI) climbed 258.3 points, or 2.9%, to end at 9,034.69, leaving the blue-chip index up more than 500 points, or 6.1%, for the week.
"Looking at the fundamentals of the economy, making judgments about the future and not simply extrapolating the past, I think '09 will be a lot better," said Chuck Lieberman, chief investment officer of Advisors Capital Management. Listen to Lieberman's remarks.
All of the Dow's 30 components closed Friday in the green. Shares of General Motors Corp. (GM) jumped 14.1% on word that lender GMAC LLC had changed its financial-services pact with the struggling auto giant to give it more flexibility in offering loans.
Also bolstering the Dow, shares of Citigroup Inc. (C) gained 6.4% after Chief Executive Vikram Pandit said in a Wednesday memo that he and Chairman Win Bischoff would not take bonuses for 2008 and will trim pay and severance packages for executives. .
The S&P 500 (SPX) climbed 28.55 points, or 3.2%, to 931.80, leaving the broad-market index with a weekly gain of 6.8%.
Energy and consumer discretionary shares fronted gains that stretched to include all 10 of the index's industry groups.
Noteworthy gains came from Massey Energy Co. (MEE), which rose 17.4%, and Consol Energy Inc. (CNX), up 12.5%.
The technology-led Nasdaq Composite (RIXF) rose 55.18 points, or 3.5%, to finish at 1,632.21, a level that left it 6.7% ahead of last Friday's close.
Data from the Semiconductor Industry Association showed worldwide semiconductor sales fell 9.8% to $20.8 billion in November, with the SIA pointing to the global economic decline for reduced demand. .
Stocks had dipped briefly into negative turf after an index of U.S. manufacturing activity contracted for a fifth straight month.
"Today's headline reading was the weakest since June of 1980, with declines in every component," said analysts at Action Economics of the factory data.
Shares of BorgWarner Inc. (BWA) rose 5.5% after the automotive-industry supplier rejected a $50 million mini-tender offer from TRC Capital Corp. .
Volume was thin, with many investors apparently still on break. On the New York Stock Exchange, about 1 billion shares traded, with more than five stocks rising for every issue on the decline. On the Nasdaq, 543 million shares traded hands, and advancers overtook decliners almost 3 to 1.
"For all practical purposes, the real start of the trading year won't take place until next week," said Kevin Giddis, managing director and head of fixed income at Morgan Keegan & Co. Inc.
Crude moves
Crude-oil futures rose to three-week highs, gaining nearly 4% on concerns that Russia's cutting off natural gas to the Ukraine could impact European energy supplies. Crude for February delivery ended up $1.74, or 3.9%, to stand at $46.34 a barrel on the New York Mercantile Exchange. .
The dollar rose after a report showed manufacturing in Europe had slowed, but the greenback scaled back gains after the weak U.S. manufacturing report. The dollar index (DXY), which tracks the currency against major rivals, edged up to 81.87 from 81.17 a day earlier.
Gold futures fell as a stronger U.S. dollar reduced the metal's appeal as an alternative investment, with the contract for February delivery declining $4.80 to end at $879.50 an ounce.
Overseas, European shares rose sharply, bolstered by gains in the mining sector and a solid start to the year by most banking stocks. .
Elsewhere, the International Monetary Fund prepared to lend about $2.5 billion to Belarus to help the Eastern European country weather the global financial crisis.
In Asia, most markets ended higher, with Hong Kong shares propelled by telecom stocks. .
U.S. stocks had rallied Wednesday, the final session of 2008, with the Dow Jones Industrial Average striking its best last-day-of-the year performance in percent terms since 1974. The Dow Jones Industrial Average gained 108 points, or 1.25%, to end down 33.8% for the year.
The S&P 500 index lost more than 38% over the course of the year and the Nasdaq Composite fell more than 40%. .
"The flushing out we experienced in the fourth quarter may be enough to finally settle the markets back into a more normal trading pattern," said Marc Pado, U.S. market strategist at Canter Fitzgerald.
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Publié le 02 janvier 2009 Copyright © 2009 Dowjones