Stock maintain momentum in second straight week

Agence France-Presse, New York

Stocks moved higher for a second straight week as investors gained confidence that a big economic stimulus package and interest rate cuts would revive the U.S. economy following last month's terror strikes.

The Dow Jones industrials gained 272.21 points, or 3.08 percent, closing at 9,119.77 while the Nasdaq rallied with a gain of 106.50 points (7.10 percent) to end Friday at 1,605.30.

The Standard and Poor's 500 advanced 30.44 points, or 2.92 percent, to 1,071.38.

Helping the mood was the Bush administration's proposal for a big stimulus plan, which was clarified on Friday when President George W. Bush called for US60 billion in new tax cuts.

Despite a deteriorating labor market and a ripple effect in the airline, tourist and travel industries, "the U.S. stock market seemed to look beyond the current season this past week, showing some conviction that conditions will change and improve early next year," said Lynn Reaser of Banc of America Capital Management.

"The equity market is counting on lower interest rates, tax cuts, government spending and lower energy prices to help spur economic growth in early 2002. Although enormous uncertainty persists, especially regarding the possibility of more terrorist attacks, we believe such a recovery is the most likely outcome."

"The market is looking for a bottom and the feeling is that we have to be close to it," said Michael Lyons, market analyst at Morgan Stanley.

"Bush's promises of tax relief is certainly going to be good for all. Everything helps, investors are grasping for any good news to get onboard the market and with any kind of encouragement you get them stepping up."

Among active issues, Cisco jumped 22.66 percent to end the week at 14.94 after an upbeat outlook from the high-tech group.

Rival Lucent Technolgies advanced 13.26 percent to 6.49 and Juniper Networks surged 55.46 percent to 15.08.

Deutsche Bank, which began trading on Wall Street Wednesday, gained 4.24 percent to 56.81.

Airlines shares also recouped some more of last month's losses as AMR gained 8.99 percent to 20.86 and Delta Air Lines 3.61 percent to 27.28.

On the bond market, the yield on the 10-year Treasury bond eased to 4.500 percent from 4.578 percent a week earlier and on the 30-year bond to 5.308 percent from 5.422 percent. A drop in bond yields reflects a rise in prices.