Posted on 02/15/2005 1:38:36 PM PST by RWR8189
The Dow Jones Industrial Average (^DJI - News) ended up 46.19 points, at 10,837.32.
The Nasdaq Composite Index (NasdaqSC:^IXIC - News) was up 6.30 points, at 2,089.21, but off an intraday high of 2,103.45.
Gains for semiconductor (Philadelphia:^SOXX - News) and Internet (CBOE:^GIN - News) stocks helped put a floor on declines.
Computer hardware stocks (CBOE:^GHA - News) also rose, buoyed by findings from technology research firm Gartner Inc. suggesting increased strength in the mobile-computer market should spur a 9 percent jump in PC shipments in 2005.
Comcast's stock gained on news that financier Warren Buffett's Berkshire Hathaway had doubled its stake in the company to 10 million shares.
"There is a more optimistic mood about the market," said Michael Metz, chief investment strategist at Oppenheimer & Co. "Circuit City was a positive and the indication that Warren Buffett has been a buyer again in the stock market has had a positive effect on psychology."
Metz said there are some investors who were waiting for the Federal Reserve chairman to deliver his views on the state of the U.S. economy in his semi-annual testimony to Congress, starting Wednesday. Read economic preview
Traders attributed an intraday dip in the market to speculation of an input error in the Nasdaq 100 tracking stock, better known as the quadruple 'Q's. (NasdaqNM:QQQQ - News) .
Tuesday's batch of economic reports offered investors a relatively reassuring picture on the economy.
Although U.S. retail sales dropped 0.3 percent in January on a slowdown in auto sales, the decline was smaller than expected.
Excluding autos, retail sales increased 0.6 percent, which was 0.1 percent better than economists canvassed by MarketWatch had been expecting.
Meanwhile, manufacturing activity in the New York area slowed a little less than expected.
The New York Federal Reserve Bank's closely watched Empire State Manufacturing index fell to 19.2 points in February from 20.1 in January. Economists had been forecasting the index to slip to about 18.9 in February.
Also, inventories at U.S. businesses were as tight in December as they've ever been, the Commerce Department reported.
Inventories increased 0.2 percent in the month, falling behind the 1 percent rise in sales, the government said.
In the wake of the data, the dollar weakened further against the euro and the yen, before it bounced back as the latest capital flows data came in better than expected. Read currency report
Nevertheless, the Treasury Department reported overseas investors reduced their purchases of bonds and stocks in December.
Foreign long-term net capital flows into the U.S. fell to $61.3 billion in December from a revised $89.3 billion in November. The figure reflects net foreign purchases of U.S. securities minus net U.S. purchases of foreign securities.
In afternoon trading, the dollar had turned lower once again.
Treasurys ended lower, with traders saying the bond market is preparing for some chance that Federal Reserve Chairman Alan Greenspan would offer a different perspective on interest rate policy and inflation when he gives congressional testimony.
The 10-year Treasury note was down 6/32 at 99 6/32. Its yield rose to 4.10 percent vs. 4.07 percent on Monday.
Gold futures ended flat on the session, erasing early weakness in a bullish sign for the precious metal. See metal stocks
Gold for April delivery was unchanged at $427.30 an ounce. Gold futures had rallied by about 4 percent between their intraday low Feb. 9 and Monday's close.
Crude-oil futures reversed early gains ending lower ahead of the latest installment of U.S. inventories data, which are expected to show another gain to already substantial stockpiles.
Crude for March delivery was down 18 cents at $47.26 a barrel, snapping a five-session run of gains.
In the broader market for equities, advancers had a 17-to-15 edge over decliners on the New York Stock Exchange, while losers had a 16-to-15 margin on the Nasdaq.
Volume was 1.5 billion shares on the Big Board and 2 billion on the Nasdaq.
The retail sector was in focus as investors digested some mixed news on the merger and acquisition front.
Shares of Circuit City Stores Inc. (NYSE:CC - News) soared as much as 21 percent after the troubled consumer electronics retailer said it has received unsolicited acquisition proposal from Highfields Capital Management LP.
The Boston hedge fund manager offered to acquire all of the consumer electronics chain's stock for $17 per share cash, a 19.5 percent premium above the stock's Monday closing price of $14.23.
The company recently reported a 5.8 percent drop in same-store sales for December. It attributed the decline to poor sales of personal computers, DVD hardware, video game hardware, wireless products and digital video services.
Circuit City shares ended up 16.2 percent at $16.53.Best Buy Co (NYSE:BBY - News) , Circuit City's biggest rival, also gained on the bid news, climbing 1.5 percent to $55.50.
Elsewhere, merger talks between May Department Stores and Federated Department Stores have foundered over the price tag of a potential deal, according to a Wall Street Journal report.
Shares of Federated rose 1.3 percent to $58, while May erased early weakness to trade up 0.8 percent, to $32.10.
Among Tuesday's earnings of note, Qwest Communications (NYSE:Q - News) saw its fourth-quarter loss narrow versus a year ago, although revenues dipped slightly in the period.
On positive note, the Denver communications company said it added 81,000 digital subscriber line customers in the quarter, bringing its total above 1 million lines at year's end. Qwest shares, which fell 4 percent Monday after losing out to Verizon in its bid to acquire MCI, rose 1.5 percent to $4.04.
Apple Computer shares hit a 52-week high for a second straight session after Merrill Lynch raised its 12-month price target on the computer maker to $102 from $85 per share on the possible announcement of a partnership with Sony Corp. (NYSE:SNE - News) .
The brokerage told clients it thinks that Apple could introduce products based on the Cell processor made by IBM, Sony and Toshiba.
According to Merrill, the partnership could take the form of an iTunes-like i-Movies store online, a high-performance Apple workstation using Cell for video editing, or a network-centric television with computing for handling the next generation of entertainment feeds. Apple (NasdaqNM:AAPL - News) ended up 4.4 percent at $88.38.
Kimberly-Clark Corp. (NYSE:KMB - News) was downgraded to "hold" by Smith Barney Citigroup, with the brokerage saying its price is now within 3 percent of its $70 price target.
"With an expected total return potential of just 5.3 percent, we now believe that the shares are valued to reflect almost all of the positive changes that the company has implemented over the past two years," the brokerage said. Kimberley-Clark shares fell 1.7 percent.
OK, where are the socialist CHICKEN LITTLEs now??? When good news hits the streets, they run like the anti-American cockroaches they are.
We wouldn't be here without Bush's tax cuts.
Neb
Bad news for Democrats / Good news for America.
Young workers are going to want those individual S.S. accounts to get fired up quickly, with this growing market. Reform delays by Democrats will now cause account losses that can be calculated during the '06 and '08 campaign cycles.
I hope you're right, but my experience is that young people are clueless about politics and vote Democrat because it "feels good." Most people I knew in my 20s would never dare vote Republican; it only started occurring once they got married, bought a house and had kids.
Once again, I hope you're right and I am wrong, but I have no faith in the 'young' vote.
I won't take offense to that(being a youngin and all), because I know a lot of young, dumb democrats... :)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.