Stock indexes managed to close modestly higher Tuesday after sustaining several bouts of profit-taking following Monday's big rally. Analysts were generally pleased with Wall Street's performance and noted that just holding steady is good news, given stocks' recent volatility.

"We're still seeing buying and that's a step in the right direction," said Bryan Piskorowski, market commentator at Prudential Securities.

The Dow Jones industrial average gained 50.44 points to end at 8654.30, bringing its two-day advance to more than 418 points. Last week, the blue-chip index lost a record 1,369 points.

The Nasdaq Composite Index rose 2.15 to 1,501.55 and the broader Standard & Poor's 500 Index rose 8.72 to 1,012.17.

"There is some hope the economy will start to show some signs of rebound,'' said Peter Gottlieb, a portfolio manager at First Albany Asset Management. "But there is a lot more data that we are going to have to see. We are going into uncharted waters, we don't know what is going to happen on the political front. That's a level of uncertainty that is going to be overhanging the market for quite some time.''

U.S. consumer confidence fell sharply in September, suffering its largest one-month drop since October 1990, during the Gulf crisis, according to a survey that captured part of the economic shock from the Sept. 11 attacks on New York City and the Pentagon.

"It's not a surprise, the data hasn't told us anything most of us didn't already suspect," said Alan Ackerman, a market strategist at brokerage Fahnestock & Co. "The home sales, however, remain strong. The U.S. economy has great qualities of resilience."

Sales of U.S. existing homes rose 5.8 percent in August to a record rate, a real estate trade group said on Tuesday in a report that contrasted with weak housing starts data from the same period.

Investors, whose portfolios were littered with minus signs before the attacks, are hesitant to make large, long-term moves. The devastation two weeks ago has ignited a flurry of layoffs, fears of a looming recession and worries over a long battle against an elusive enemy. 

U.S. Treasury Secretary Paul O'Neill said on Monday the attacks on the World Trade Center in New York and the Pentagon near Washington could delay recovery in the world's top economy by a ``quarter or so.'' The Federal Reserve has cut interest rates eight times this year, including once following the attacks, to stave off a recession. 

In corporate news, AOL Time Warner Inc. shed 18 cents at $32.32. The Internet and media giant expects 2001 cash earnings and revenue to miss its previous targets due to the slide in advertising after the attacks.

Wal-Mart Stores Inc., the world's largest retailer, climbed $1.04 to $48.32. Wall Street house UBS Warburg raised its rating on the Dow component. 

VeriSign Inc., one of the world's leading providers of Web addresses, added $1.80 to $41.66. The company has tied up with one of India's leading Internet portals, Rediff.com, to offer personalized Web addresses to Indian individuals. 

Yellow Corp. sank $3.69 to $19.01. The transportation services company said it would not meet Wall Street estimates due to the economic slowdown. 

Wall Street on Monday enjoyed a welcome respite to the brutal selling that had plagued the market since the Sept. 11 attacks that left about 7,000 people dead or missing.

On Monday, the Dow racked up its fifth biggest point gain ever, rising 368.05 points, or 4.47 percent, to close at 8,603.86. The Dow last week racked up its worst drop in more than 60 years.

The Nasdaq jumped 76.22 points, or 5.36 percent, to 1,499.41, after plummeting 16 percent last week. The S&P rose 37.65 points, or 3.86 percent, to 1,003.45, bouncing back from last week's 11.6 percent slide.

Some strategists feared the rally, which landed the blue-chip Dow its fifth largest point gain ever, was just an overdue bounce after major stock gauges sank about 15 percent last week. 

``I think yesterday's rally was just a sigh-of-relief rally, I don't see much to straighten out this market until we see what happens with military action and what is going on in the economic front,'' said James Volk, co-director of institutional trading, D.A. Davidson and Co. ``There is no way to tell what is going to happen with that.'' 

Reuters and the Associated Press contributed to this report.