8:10 am - DJIA has finally closed above 9,000

8:05 am - Wall Street enjoys upbeat start to 2009

NEW YORK (AP) - Wall Street started 2009 with a big rally Friday asinvestors, brushing aside a disappointing report on manufacturing, sent the DowJones industrials up more than 250 points and to their first close above 9,000in two months. All the major indexes shot up more than six percent for the week. The market lived up to the hopes of many analysts that it would have a freshstart in the new year after a horrific 2008. But many traders were also waitingto see how the market fares next week; they're cognizant of the fact thatpost-holiday volume was light and therefore Friday's trading might not be thebest indicator of market sentiment. Still, the market held to its recent pattern of taking bad economic news instride, a pattern that began to emerge after it touched multiyear lows on Nov.20. "Over the last month you've started to see a change in sentiment and thiscertainly advances that," said Carl Beck, partner at Harris Financial Group inRichmond, Va. The Institute for Supply Management said its manufacturing activity indexfell to the lowest level in 28 years in December. The ISM, a trade group ofpurchasing executives, said its manufacturing index fell to 32.4 last month from36.2 in November. Economists polled by Thomson Reuters had expected a reading of35.5; a figure below 50 indicates contraction. "We like to see the markets shrug off the bad news. That typically is a signthat we're forming a bottom," said Eric Thorne, an investment adviser at BrynMawr Trust. Todd Leone, managing director at Cowen & Co., cautioned against reading toomuch into Friday's advance and said the first full week of the new year shouldprovide insight into investor sentiment for 2009. "The first five days are usually very telling," Leone said. "I'm not surewe'll be up or down." He said an advance in stocks Friday wasn't a surprise assome investors start the year by wading into the market. He said selling is morelikely to occur next week. The Dow rose 258.30, or 2.94 percent, to 9,034.69, finishing the week up 6.1percent. The blue chips last closed above 9,000 on Nov. 5, when they stood at9,139.27. The Dow, the oldest of the big market indexes, fell 33.8 percent in 2008,its worst performance since 1931, during the Great Depression. Like the Dow, broader stock indicators also advanced for the third straightsession. The Standard & Poor's 500 index rose 28.55 percent, or 3.16 percent, to931.80, its highest close since Nov. 5. The Nasdaq composite index rose 55.18,or 3.50 percent, to 1,632.21. For the week, the S&P 500 finished up 6.8 percent, while the Nasdaq rose 6.7percent. The Russell 2000 index of smaller companies rose 6.39, or 1.28 percent, to505.84. Advancing issues outnumbered decliners by about 5 to 1 on the New York StockExchange. Consolidated volume came to 3.48 billion shares, compared with 3.75billion on Wednesday. Bond prices fell as investors took on riskier assets including stocks. Theyield on the benchmark 10-year Treasury note, which moves opposite its price,rose to 2.39 percent late Friday from 2.22 percent late Wednesday. The yield onthe three-month T-bill, considered one of the safest investments and in greatdemand since the credit markets seized up in September, fell to 0.07 percentfrom 0.08 percent Wednesday. The dollar was mixed against other major currencies, while gold prices fell. Light, sweet crude rose $1.74 to settle at $46.34 a barrel on the New YorkMercantile Exchange. Thorne contends 2009 could be a strong year for Wall Street because mostinvestors are so shaken from the sell-off in 2008, which erased six years ofgains in stocks. Market bottoms often emerge because investors are sopessimistic or because stocks seem incapable of making any sustained recovery. "A bottom isn't formed in one day or even in one month but probably overseveral months," he said. "Expectations are extremely low for the economy, forcorporate earnings and for the stock market itself." Since hitting multiyear lows on Nov. 20, the Dow has advanced 19.6 percent,while the S&P 500 is up 23.8 percent. "We're very confident that the $9 trillion that is in cash right now willlook to find a home in better-performing assets," he said, referring to theamount of money invested in conservative but low-yielding areas like moneymarket funds. Yields on safe investments like Treasurys have fallen to virtuallynil as investors have clamored for safety and surrendered hopes of even earninga return on their money. Next week brings a flurry of economic readings and potentially earlycomments from companies on their 2008 results and 2009 forecasts. Traders will be anxiously awaiting a Labor Department report next Friday onDecember employment. A month ago, Wall Street showed newfound resiliency in theface of a bad reading on what is typically the most important economic report ofthe month. Stocks initially sagged but finished with big gains Dec. 5 after thegovernment reported that employers slashed a larger-than-expected 533,000 jobsin November. Investors were hoping the report would prompt Washington to takebroader steps to shore up the economy. "The employment numbers will almost undoubtedly be very ugly. What will beinteresting to see is what the market's reaction will be to those numbers,"Thorne said. "We're also very interested to see what the corporate earningsreporting season will be like." Harris Financial's Beck said the earnings reports could be a turning pointfor the market. "People expect earnings to be really bad. If they come out andthey're not quite as bad, you could see this momentum in the market continue,"he said. "If they come out even worse than expectations, that could be a majorset back." Stocks overseas also began the new year with a rally. Britain's FTSE 100rose 2.88 percent, Germany's DAX index jumped 3.39 percent, and France's CAC-40increased 4.09 percent. Markets in Japan were closed for a holiday. The Dow Jones industrial average ended the week up 519.14, or 6.1 percent,at 9,034.69. The Standard & Poor's 500 index rose 59, or 6.8 percent, to 931.80.The Nasdaq composite index ended the week up 101.97, or 6.7 percent, at1,632.21. The Russell 2000 index finished the week up 29.07, or 6.1 percent, at505.84. The Dow Jones Wilshire 5000 Composite Index -- a free-float weighted indexthat measures 5,000 U.S. based companies -- ended at 9,364.54, up 595.19 points,or 6.79 percent, for the week. A year ago, the index was at 14,613.57.