Stocks Close Higher

Stocks rose as investors, clinging to hopes that corporate scorecards could hint at a recovery in profits later in the year, crept back into the market after a last week's harsh sell-off.

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Volume was lighter than usual as Wall Street hesitated to make big bets before the second-quarter earnings reporting period swings into high gear later this month.

"Next week is when earnings start to roar in and that's what most people are waiting for," said Michael Lyons, listed equities trader for Morgan Stanley. Still, "some of these stocks have gotten beaten up to a point that money managers will get involved."

The Nasdaq Composite Index gained 22.55 points, or 1.13 percent, at 2,026.71, recovering somewhat from a 7 percent slide last week.

The blue-chip Dow Jones industrial average rose 46.72 points, or 0.46 percent, to 10,299.40. AT&T Corp., which received an unsolicited $44.5 billion bid from cable company Comcast Corp. for its broadband unit, led the blue-chip gauge higher with a $1.98 gain at $18.70.

The broader Standard & Poor's 500 Index was up 8.19 points, or 0.69 percent, at 1,198.78.

About 1.04 billion shares changed hands on the New York Stock Exchange, according to preliminary figures. About 1.38 billion shares traded on the Nasdaq, less than June's daily average volume of 1.7 billion.

Stocks to Watch

Many analysts were skeptical of the rally after the market ended the first week of the third quarter sharply lower Friday on a slew of profit warnings.

"Today has been a little bit surprising. We have had some upside reaction — which very few people expected," said Alan Ackerman, executive vice president at brokerage Fahnestock & Co. "I think the real pop today is just that we went down so sharply on Friday. There is a bit of bargain hunting going on, but I think the mood remains extremely cautious."

AT&T Corp., which received an unsolicited $44.5 billion bid from cable company Comcast Corp. for its broadband unit, jumped $1.99 to $18.71 and was the most-active stock on the New York Stock Exchange.

Comcast, the No. 3 U.S. cable-television company, lost $3.27 to $39.01. Comcast said it made the offer for AT&T Broadband after months of talks with AT&T failed. AT&T said it had no plans to sell.

AT&T Wireless Group Inc., the No. 3 U.S. wireless services firm, shed 62 cents to $16.53. As expected, AT&T Corp. split off its wireless unit into a separate, independent company, marking a major step in the telephone and cable giant's restructuring.

Amid other merger news, International Game Technology the world's No. 1 slot machine maker, said it agreed to acquire rival Anchor Gaming in a deal valued at about $1.365 billion.

IGT slipped 73 cents to $58.47, while Anchor Gaming gained $2.17 to $56.08.

EMC Corp. was among stocks that recovered somewhat from steep sell-offs on Friday. The stock rose $1.03 to $22.63. On Friday the data-storage company warned earnings will fall as much as 76 percent below estimates as cost-cutting failed to jump-start demand.

NCR Corp., which makes computer systems for banks and retail stores, surrendered $6.23 to $38.54. The company warned its earnings and revenues will be lower than expected because its customers put off purchasing decisions in its data warehousing unit.

Investors will be poring over Corporate America's financial reports as the second-quarter earnings season gathers speed this week.

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