Stock Market Rebounds As Inflation Jitters Ease

Stocks shot higher Friday with bond prices, as fresh economic data and lower commodities prices eased fears of a resurgence of inflation.

The Dow Jones industrial average rose 45.52 points to 5,532.59, recouping just a fraction of the 196-point sell-off that occurred from Monday through Wednesday. For the week, the Dow was down 150.29 points.

The widely followed indicator also is 157.15 points, or 2.8 percent, below the all-time closing high of 5,689.74, which was set April 3.

While benign economic data may have paved the way for Friday’s comeback, it was “strictly a technical bounce,” said Larry Rice, chief investment officer at Josephthal, Lyon & Ross.

Stocks and bonds had been “very badly over-sold,” Rice said. “There was nothing earth-shaking in today’s (economic) data,” except that they “did not compound the worries of yesterday.”

Technical or not, the advance was broad.

Advancing issues outnumbered decliners by nearly 2 to 1 on the New York Stock Exchange. Volume was strong at 411.95 million shares as of 4 p.m., but well below Thursday’s 519.66 million figure, the sixth-busiest day ever.

Some of the stocks that moved substantially or traded heavily Friday:

NYSE

IBM fell 6 to 111-1/2.

Smith Barney downgraded the stock to outperform from buy, saying the stock is close to Smith Barney targets that have been raised regularly as the computer maker churns out strong earnings, and that profits may be hurt by the rising dollar. SoundView Financial Group downgraded the stock to near-term hold from buy, but maintained its long-term hold rating.

Boeing rose 2-3/8 to 81-1/2.

Goldman Sachs & Co. placed the stock on its recommended list with a buy rating, up from moderate outperform. The upgrade came after China, in a major blow to the aircraft maker, agreed to work with Airbus Industrie, a European consortium, toward development of a new 100-seat commercial jet, and to purchase 33 jets from Airbus.

AT&T Corp. rose 1 to 62-5/8.

The telecommunications giant Thursday said it had made arrangements to provide local phone service through five companies that have connections in 70 cities. The deal would be AT&T’s first foray into local telephone service since the break-up of the company.

General Motors rose 7/8 to 55-5/8.

The car maker said it will close, sell or seek partners for five plants the company considers too costly to be competitive. The announcement came before GM begins national contract negotiations with the United Auto Workers union this fall.

NASDAQ

Ross Stores rose 3-7/8 to 34-1/2.

The retailer said Thursday that March sales surged 25 percent, while sales in outlets open at least a year rose 18 percent.

AMEX

Biovail Corp. International rose 7/8 to 23-7/8.

The shares dropped 2-7/8 Thursday after wide distribution of a report from HKS & Co. that voiced skepticism about the commercial prospects of Biovail’s Tiazac calcium channel blocker. The company disagreed that the report caused the stock to fall but did say Tiazac sales were soft, adding that the overall market for calcium channel blockers was very competitive and declining.