WALL STREET No news is good news for market

Analysts expect a holiday rally but warn against too much optimism for 2003.
NEW YORK (AP) -- Despite a tepid week on Wall Street, many analysts think investors are poised to close 2002 with a feel-good rally. Still, gains may be short-lived if economic data and earnings outlooks in January point to a weaker-than-expected recovery.
Wall Street ended a second week of declines on light volume Friday, raising fears that the market lacked strength to stage a holiday rally -- particularly after blue chips posted eight weeks of gains in October and November.
But analysts say there's no reason to doubt a month-end surge. Few companies issue outlook warnings around the holidays, and investors are looking to put year-end bonuses and dividends to work.
"The calendar says we usually get a holiday rally. And one reason we do is because every year at the end of the quarter, no news is coming out," said Chuck Hill, director of research at Thomson First Call.
"Most people tend to be optimists, and the fact that you're not hearing bad things gets people excited about what to expect next year," he said.
The mood
This past week, investors remained cautious, sending stocks lower despite the best retail sales figures in three months and a jump in consumer sentiment. A brokerage downgrade of IBM and a dour outlook from Kimberly-Clark, meanwhile, dampened enthusiasm.
That tone may well change in the coming weeks. December historically is the strongest time of year for stocks, with most gains coming at month's end.
Indeed, a study by Ned Davis Research in Venice, Fla., found that the last seven trading days in December showed the biggest average gain for the S & amp;P 500 compared to the rest of the month.
Still, although many investors may jump in on prospects that 2003 will be the start of a bull market, analysts caution against too much optimism, given the uncertain economic outlook for the coming year.
"If we get a Santa Claus rally at the end of December, that probably wouldn't tell you anything about next year," said Sam Burns, analyst at Ned Davis.
That's because investors will likely be bombarded with data in early January from companies who choose to release their profit warnings after the holidays. Analysts also will begin setting estimates for the first quarter, which many worry may be particularly slow.