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American Morning

America Recovers: Powerful Rally on Wall Street Yesterday

Aired October 04, 2001 - 09:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA ZAHN, CNN ANCHOR: Andy Serwer this morning is smiling a little bit more than he was yesterday. Stocks surging ahead, with the Dow up 173 points at its closing. Nasdaq jumped up as well, 88 points.

ANDY SERWER, "FORTUNE" MAGAZINE: A powerful, powerful rally yesterday, Paula. Nasdaq up almost 6 percent. That is huge, and you know, the train keeps a-rolling here, surprising a lot of people yesterday. We had the Bush stimulus package, surprised and pleased a lot of people on Wall Street, some positive notes from Cisco, and the service sector actually looked like it was steaming along, even through attack, so that was that was a real positive that kept the market going.

You know what surprises me here is that we keep these getting economic numbers. Sometimes they are bad. They are usually a little bit better than anticipated since the attack, but the market is shrugging them off. We'll get another test this morning, because we just got new jobless claims this morning coming in at 528,000. That's up 71,000, and more than expected, 466 was expected. This is for the week ended September 29th.

ZAHN: But that doesn't mean a whole lot, unless you understand the context of where they sat nine years ago. Is it true this highest level they have reached in nine years?

SERWER: Yes, highest since July of 1992, but, again, Paula, is it any surprise that new jobless claims are up, given what's happened, and so I would not be surprised, if the markets continue to show some strength here. Overseas markets were very strong. The Nikkei was up 2.8 percent. Hang Seng in Hong Kong up 3 percent. European markets were up. Futures were up. And we have positive news this morning from Dell, from Dell Computer this morning, reaffirming guidance, saying that it anticipates its numbers are fine going forward. We have reports that CEO Michael Dell had been buying some stock.

We will be getting factory orders at 10:00, but they're for August, so that's sort of old news, but the market shrugging it off, and it just shows that if you tray to time these things, you make a big mistake, because the rallies can come awfully quick.

ZAHN: Let's move ahead to tomorrow. We earlier today had Treasury Secretary O'Neill on, to try to get to the preview of the unemployment numbers. You and I have been talking about them all week. You wouldn't tell me how much over 5 percent they might be, but what impact might that have on the market tomorrow, and what numbers do you think we are looking at?

SERWER: I think we're definitely going to tip over 5 percent. I don't think there's any question. But again, this is now so in the bag, it's so anticipated. And where do we go from here? Merrill Lynch economists are looking for more like 6 percent, as we get later in the year, and more toward next year. So -- it's -- the real question is, how bad do things get from here? I don't think anyone is going to be surprised at 5 percent plus tomorrow.

ZAHN: OK. Andy Serwer, stay with us. We are going to along for the ride with you all morning long.

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