NEW YORK – Blue chips rose moderately and technology shares remained flat Friday as investors eyed upbeat earnings from health insurance giant Cigna and digested a mixed batch of economic reports for clues to the economic rebound.
Growing problems at mutual fund company Putnam Investments punished the shares of its parent, insurance broker Marsh & McLennan Cos. Inc. (MMC).
The Dow Jones industrial average closed up 14.51 points, or 0.15 percent, at 9,801.12. The broader Standard & Poor's 500 Index ended up 3.77 points, or 0.36 percent, at 1,050.71. But the technology-laced Nasdaq Composite Index fell 0.48 of a point, or 0.02 percent, to 1,932.21, based on the latest available figures.
Friday's close marked the first time the Dow scored a gain in each day of the trading week since June. The Dow rose 2.3 percent for the week and climbed 5.7 percent in October -- its largest monthly gain since April. This was the Dow's seventh month of gains in the last eight.
Nasdaq rose 3.6 percent for the week and jumped 8.1 percent for the month, ending October with its largest monthly gain since May.
As the major market gauges notched solid gains for the week and the month of October, investors backed off toward the end of the trading day.
The Dow got a boost at midmorning when the Israeli company Teva Pharmaceutical Industries Ltd. (TEVA) announced it would acquire Sicor Inc. (SCRI) of Irvine, Calif., for $3.4 billion in cash and stock. Teva fell 79 cents to $56.92, but Sicor rose $1.81 to $26.78.
"When noon hit, the volume dried up," said David Serena, chief operating officer at investment bank May Davis Group. "People just want to go into the weekend flat. The large institutions get nervous and stay out of the market completely."
Shares of Cigna (CI) surged $9.08, or 19 percent, to $57.05 after it raised its 2003 earnings outlook and set a 2004 view higher than Wall Street had expected as the company keeps a lid on medical costs. Cigna also swung to a profit for the third quarter from a year-ago loss.
Marsh & McLennan, hurt by the latest Putnam developments, fell $1.75, or 3.9 percent, to $42.75, after falling as low as $42.15. Putnam is facing a probe into improper mutual fund trading and losing some clients. On Tuesday, state and federal regulators charged Putnam and two of its managers with civil securities fraud. Since then, a string of state pension funds have followed the lead of the Massachusetts and fired Putnam. And the U.S. Attorney for the Southern District of New York has issued a subpoena to Putnam for its documents related to mutual fund trading.
Among the Dow's top percentage gainers were SBC Communications Inc. (SBC), up 50 cents or 2 percent at $23.98, and Johnson & Johnson (JNJ), up 85 cents or 1.72 percent at $50.33.
Oil companies Anadarko Petroleum Corp. (APC) and ChevronTexaco Corp. (CVX) reported reported third-quarter earnings ahead of analysts' estimates. Anadarko shares rose 77 cents to $43.62, while ChevronTexaco advanced $2.54 to $74.30.
Agribusiness giant Archer Daniels Midland Co. (ADM) said earnings rose about 40 percent from a year ago. Its shares rose 78 cents to $14.35.
Before trading began, the government reported that consumers kept a tighter grip on their wallets in September, trimming spending by 0.3 percent. Analysts had expected a 0.1 percent drop. Consumer spending had risen 1.1 percent in August an 1 percent in July.
Still, Americans' incomes rose 0.3 percent in September for the third month in a row, slightly better than the 0.2 percent increase analysts had expected.
Heavy consumer spending in the summer months helped boost the nation's economic growth to 7.2 percent in the third quarter, the strongest performance in nearly 20 years, according to a government report released Thursday.
Trading was moderate on Friday, with 1.4 billion shares traded on the New York Stock Exchange and 1.8 billion on Nasdaq. Advancers outpaced decliners by about 5 to 4 on the NYSE, while decliners narrowly outnumbered advancers on Nasdaq.
The Russell 2000 index, which tracks smaller company stocks, fell 2.15, or 0.4 percent, to 528.22.
Overseas, Japan's Nikkei stock average closed Friday down 1.3 percent. In Europe, France's CAC-40 dropped 0.4 percent, Britain's FTSE 100 fell 0.3 percent while Germany's DAX index was rose 0.5 percent. Reuters and the Associated Press contributed to this report.
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