Dow Post First Positive Week in Two Months

N E W  Y O R K, July 13, 2001 -- Stocks rose today,extending Thursday's big rally and closing out the Dow Jonesindustrial average's first winning week in two months, asinvestors placed bets that the corporate earnings slump may becoming to an end.

Track Your Stocks | Check Your Portfolio

The Dow Jones industrial average rose 60.07 points,or 0.57 percent, to finish at 10,539.06, according to thelatest data, while the Nasdaq composite index edged up

8.97 points, or 0.43 percent, to 2,084.71 after late-sessionselling clipped larger gains earlier in the session. Thebenchmark Standard and Poor's 500 index rose 7.54points, or 0.62 percent, to 1,1215.68.

For the week, the Dow gained 2.8 percent — the firstweekly gain since the week ended May 18 — the Nasdaq compositerose 4 percent and the S&P 500 grew 2.1 percent.

Friday's follow through came after the biggest stock-marketrally in two months Thursday, sparked primarily by Microsoftthe world's No. 1 software company and Dow componenttold investors to expect an improvement in quarterly sales.

"People are shrugging off" bad news, said Joseph Ranieri,managing director of trading at Adams, Harkness & Hill inBoston. "In the third and fourth quarter, we could get somesigns of an upturn and people are setting themselves up now."

Check on Inflation and Consumers

A government report before the opening bell showed thatsales at U.S. retail stores showed tepid gains for a secondstraight month in June, lifted primarily by an uptick in newcars sales due to price discounting. The report implied acautious shopping mood among consumers, whose spending fuelstwo-thirds of national economic activity.

"The numbers are just a little bit troublesome," said HughJohnson, chief investment officer of First Albany Corp inAlbany, New York. "The single biggest worry is that consumerspending will slow."

Johnson said the retail sales report will weigh on themarket, though not heavily. "Clearly the market's focus isstill earnings," he added.

Prices paid to U.S. producers fell in June at the sharpest rate in more than two years, the government also said before the market opened, indicating a nonthreatening inflation picture.

The Producer Price Index, a closely watched gauge ofwholesale inflation, slid 0.4 percent last month after a slim0.1 percent gain in the prior month, the Labor Departmentsaid.

"The decline in PPI is greater than had been expected,"Johnson said. "The reason is the decline in energy prices wasclearly steeper than we had expected. That accounts for thesurprise in PPI."

The Commerce Department said June retail sales were up 0.2percent to a seasonally adjusted $292.9 billion following arevised 0.4 percent gain in May. June sales were slightlyweaker than the 0.3 percent advance forecast by Wall Streeteconomists.

In another report, U.S. consumer confidence edged higherfor a third straight month in July but the survey did little toenthuse the market. The University of Michigan's preliminaryJuly consumer sentiment index pushed up to 93.7 from 92.6 inJune, extending a gradual rebound from a floor of 90.6 inFebruary, its lowest level in nearly five years.

Movers and Shakers

Juniper, the No. 2 maker of Internet routers, gained 13cents to $28.60. The company posted results that were in linewith sharply reduced estimates and forecast a slight salesrecovery by year-end. Its rival Cisco Systems Inc.added 96 cents to $18.82.

Stocks of companies that did not hint at a later-yearrecovery did not fare so well.

Advanced Micro Devices Inc. dropped $1.40 to$21.30. The chip maker reported results that topped sharplylowered expectations, but cautioned it may report athird-quarter loss and a sales drop of 10 percent to 15 percentfrom second-quarter levels.

Internet security software maker RSA Security Inc.sank $3.98 to $25.97 after warning results for the second halfof the year would fall well short of Wall Street estimates andeconomic difficulties could last for two to four morequarters.

Intel Corp., AMD's chief rival in the market formicroprocessors, swung between gains and losses. Inmid-afternoon trading, shares slipped 8 cents to $30.02. ThePhiladelphia Stock Exchange semiconductor index eased0.54 percent.

Computer memory chip developer Rambus Inc. dropped$1.03 to $9.85. The company reported that profits fell as itwas hit by an industry slowdown and a mounting bill for legalfights.

Personal-care products maker Kimberly-Clark Corp.fell $1.14 to $53.89. The company, hurt by weak foreigncurrencies, said earnings would be below analysts' estimatesand it lowered full-year guidance for the second time in threemonths.

Thursday’s Highlights

The technology-rich Nasdaq Composite Index leapedahead 103.70 points, or 5.26 percent, to end at 2,075.74Thursday. This was the biggest percentage gain for the indexsince April 18, according to research firm MarketHistory.com.

The blue-chip Dow Jones industrial average jumped237.97 points, or 2.32 percent, to 10,478.99. The broaderStandard & Poor's 500 Index gained 27.96 points, or2.37 percent, to 1,208.14. MarketHistory.com said the indexessaw their biggest percentage gains since May 16.

The Associated Press and Reuters contributed to this report -->