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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (42510)	9/24/2001 2:14:20 PM
From: stockman_scott	Read Replies (1) \| Respond to of 65232

Stocks Stage Rally After Last Week's Rout Monday September 24 By Denise Duclaux NEW YORK (Reuters) - Stocks raked in big gains at midday on Monday, propelling blue chips more than 4 percent higher, as investors snapped up bargains after last week's stunning sell-off sparked by deadly attacks on the nation. ``By almost any measure, the downdraft in the market was overdone,'' said John Davidson, chief investment officer at Circle Trust Co., which manages $8 billion. ``I think there is continued uncertainty and continued volatility, but if you look out a year I see a much stronger economy.'' The market seemed primed for a bounce after last week's wrenching slump of about 15 percent. President Bush vowed the U.S. economy will bounce back, and Wall Street bull Abby Joseph Cohen raised her stock weighting. Oil prices sank more than 10 percent, ending a two-year oil price bonanza and offering relief to companies struggling to turn a profit. Frightened investors had dumped stocks and shattered some records last week, the first full week of trading since the Sept. 11 assaults. The blue-chip Dow Jones industrial average (.DJI) skidded 1,370 points, chalking up its biggest weekly loss since the Depression in the 1930s. Wall Street pros blamed much of the selling on raw emotion after the attack on New York's World Trade Center towers, which left more than 6,400 dead or missing just three blocks from the New York Stock Exchange. The market still faces many hurdles as the nation begins a war on terrorism and battles a possible economic recession, but Wall Street welcomed the rally. ``It does feel good,'' said Rick Meckler, president of investment firm Liberty View. ``Traders have been somewhat pessimistic, in fact depressed, and have been looking for some ray of optimism. It feels good for most of us who have been long on stocks we thought would stop going down.'' The Dow surged 349.92 points, or 4.25 percent, to 8,585.73 after crumbling 14.26 percent last week. General Electric Co. (NYSE:GE - news), up $3.90 at $35.20, helped buoy the Dow after saying on Friday it was on track to deliver double-digit earnings growth. The Nasdaq Composite Index (.IXIC) jumped 72 points, or 5.06 percent, to 1,495.19, after plummeting 16 percent last week. Web gear giant Cisco Systems Inc. (NasdaqNM:CSCO - news) gained 88 cents to $12.97. Chip leader Intel Corp. (NasdaqNM:INTC - news) added $1.94 at $21.24. Both boosted the tech-packed index. The broader Standard & Poor's 500 Index (.SPX) was up 36.9 points, or 3.82 percent, to 1,002.70, bouncing back from last week's 11.6 percent slide. All three stock gauges are trading near three-year lows after declines of more than 10 percent last week. ``We can't go down every day; you simply reach an inflection point where you snap back,'' said Larry Wachtel, a market analyst at Prudential Securities. ``Even in the worst crisis, there is always a snap-back. The question is how sustainable it is. The burden of proof is on the bulls.'' Winners outpaced losers 3-to-1 on the New York Stock Exchange and the Nasdaq. A heavy 840 million shares changed hands on the Big Board and almost 1 billion traded on the Nasdaq. Last week, the New York Stock Exchange clocked three of busiest days ever. Bush on Monday bemoaned the thousands of layoffs triggered by the Sept. 11 attacks but promised a recovery in America's economy will bounce back. ``I want to assure the American people that the fundamentals for growth are very strong,'' Bush told reporters during a Rose Garden appearance. Goldman Sach's chief investment strategist Abby Joseph Cohen raised her recommended stocks allocation to 75 percent from 70 percent and cut her bond weighting to 22 percent from 27 percent. Stocks are more attractive than before in part because they are undervalued, Cohen told clients. The oil service index (.OSX) fell 3.59 percent as a weakening global economy stemmed demand and sent oil prices hurtling more than 10 percent to their lowest in almost two years. OPEC was left powerless to respond to a collapse on world oil markets that could signal the end of an price boom engineered by the cartel over the past two years. Optical components maker JDS Uniphase Corp. (Toronto:JDU.TO - news; NasdaqNM:JDSU - news) rallied 80 cents to $6.16. The optical components maker said although an industry downturn has yet to reverse, signs of stabilization are emerging. Internet security firm VeriSign Inc. (NasdaqNM:VRSN - news) added 26 cents to $38.56. VeriSign said it plans to buy Illuminet Holdings Inc. (NasdaqNM:ILUM - news), a provider of network connectivity and services to telecommunications carriers, in an all stock deal valued at $1.2 billion. Illuminet rose 14 cents to $35.12. Internet service provider Prodigy Communications Corp. (NasdaqNM:PRGY - news) jumped $1.94 to $5.48. Communications holding company SBC Communications Inc. (NYSE:SBC - news), which owns a 42-percent stake in Prodigy said it is making a tender offer for all outstanding shares at $5.45 per share. SBC rose 56 cents to $44.81.