Nasdaq closes above 2,000
OLIVER BERTIN
Monday, December 29, 2003
The Nasdaq Stock Market crossed the 2,000 mark and closed atop that level for the first time since January, 2002, while Bay Street stocks had a banner day jumping 1.5 per cent.
North American markets shot out of the gate Monday as investors hoped to catch a ride on the Santa Claus rally — the period between Christmas and New Year's Day when stocks seem to rise.
At 4 p.m., the Dow Jones industrial average was up 121.25 points or 1.2 per cent to 10,445.92. The Nasdaq Stock Market did even better, rising 32.90 points or 1.7 per cent to 2,006.04. The S&P 500 rose 12.92 points or 1.2 per cent to 1,108.84.
The last time the Nasdaq closed above 2,000 was on Jan. 15, 2002.
The Toronto Stock Exchange S&P/TSX composite index followed suit, jumping 131.15 points or 1.6 per cent to 8,267.93. Gold stocks led the rise, with the sector rising 5.4 per cent.
But worries over the size of the U.S. deficit sent euro up to record highs versus the U.S. dollar, passing $1.25 (U.S.) for the first time to reach $1.2511 before falling back to $1.2487 by noon. The euro has risen by nearly 19 per cent against the dollar this year. Spot gold followed suit, touching $415.40 in London, its highest level since February, 1996, before closing at $413.05, up $2.05 from the last time it traded, on Christmas Eve. But fears of mad-cow disease hit the Canadian dollar, sending it down to 76.31 cents
The NYSE and Nasdaq last traded at 1 p.m. on Boxing Day. Canadian markets have been closed since 1 p.m. on Dec. 24.
The markets rose Monday morning despite the absence of major news on the economic or corporate front. Bombardier Inc. reported winning a $170-million (Canadian) contract to supply 48 electric locomotives to the Italian railways. The news failed to ignite the markets. Bombardier's class B shares were flat at $5.30 on the TSX on a volume of 720,700.
With the absence of anything new, mad-cow disease as the main focus of trading Monday morning. Wendy's International Inc. rose by 68 cents (U.S.) to $38.67 after the third-largest hamburger chain said sales have remained strong since the discovery last week of mad-cow disease in a Washington-state Holstein herd.
McDonald's Corp. also rose, by 43 cents to $24.52, recovering some of the ground it has lost over the past week. It was trading over $25 before mad-cow disease was discovered. It helped that brokerage J. P. Morgan Securities Inc. raised its rating to "overweight."
Maple Leaf Foods Inc. fell 8 cents (Canadian) to $10.70 on the TSX after the Toronto-based meat-packer reminded investors that it had moved away from beef in recent years to pork and poultry. Tyson Inc. also recovered from the panic selling last week, rising 41 cents to $13.
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