Newspaper article THE JOURNAL RECORD

NASDAQ Climb Ends

Newspaper article THE JOURNAL RECORD

NASDAQ Climb Ends

Article excerpt

NEW YORK (AP) -- Stocks fell Wednesday as investors, wary even in the midst of their resurgent optimism, decided to cash in profits from a market that has been rallying hard since early April.

The pullback, which had been anticipated, ended the Nasdaq Composite index's six-session advance, its longest winning streak since February 2000.

The Nasdaq closed the session down 70.37 at 2,243.48. The Dow Jones Industrial Average stumbled 151.73 to 11,105.51. The market's broadest measure, the Standard & Poor's 500, declined 20.33 to 1,289.05.

The losses were predictable given the market's recent advance. The Nasdaq gained 231.93 in the previous six sessions while the Dow advanced 384.27 during the past five trading days.

"After the good-size runup we have had, you can expect some profit taking. Also, the Dow is bumping along near its old high, which is always a difficult point to penetrate," said Eugene G. Mintz, financial markets analyst at Brown Brothers Harriman.

The Dow's closing high is 11,722.98, reached Jan. 14, 2000.

Wall Street has been surging since early last month, primarily because of the five interest rate cuts made by the Federal Reserve this year. Investors are growing increasingly confident the economy will strengthen by the end of 2001, which has prompted them to start buying stocks again.

"We are looking for the resurgence of a bull market. It probably has already started," Mintz said.

Wednesday's trading showed, however, that despite investors' more positive outlook they are still cautious. Companies are still suffering the effects of the economic slowdown, which analysts say will continue to put pressure on stock prices and in turn make investors hesitant about bigger commitments to the market.

"The market has moved like a bullet with very little economic justification for the rally," said Alan Ackerman, executive vice president at Fahnestock & Co.

Mintz said politics were a minor contributor to the market's downturn as senior aides to Sen. James Jeffords, R-Vt., said he intends to abandon his party and become an independent. Such a switch would end GOP control of the Senate and could affect President Bush's agenda, including the income tax cut favored by Wall Street. …

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