The Dow Jones industrial average, which is less weighted to technology than the other major indexes, showed the most strength. The Dow lost 908.07 points, or 8.4 percent, to close the quarter at 9,878.78, on top of its 6.2 percent loss last year. In a surprising exception to the woes of many technology stocks, Microsoft was the Dow's strongest component for the quarter. Microsoft rose 26.1 percent, after losing 63 percent last year, as investors grew more optimistic about the company's chances for resolving its antitrust battle. Other winners included Philip Morris, the tobacco and food giant, whose stock price rose 7.8 percent, on top of a 91 percent gain last year.
Many strategists remain optimistic about the chance for a rebound.
The Fed's rate cuts are certain to help the economy eventually, and on a price-earnings basis, the overall market is no longer expensive, bulls say. Even some longtime bears have begun to change their stance. She noted that many stocks actually bottomed in the fall, and that stocks of companies closely tied to economic growth have already begun to rally. E-mail this story to a friend. All rights reserved.