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Monday, August 02, 2004

REUTERS - U.S. Blue Chips Up as Attack Fears Ease

Mon Aug 2, 2004 03:22 PM ET

By Rachel Cohen
NEW YORK (Reuters) - U.S. blue chips advanced slightly on Monday as fears about possible attacks on U.S. financial institutions receded and consumer products maker Procter & Gamble Co. (PG.N: Quote, Profile, Research) posted strong quarterly earnings.

The warnings about the possible attacks depressed stocks earlier in the session but as the day progressed, investors shrugged off some of their fears.

"It opened lower because some people took to heart what was said," said Stanley Nabi, vice chairman at Silvercrest Asset Management Group. "Then once the moderate selling as a result of this kind of psychological turning point was over, the market started gathering a little bit of momentum."

Citigroup Inc. (C.N: Quote, Profile, Research) , Prudential Financial Inc. (PRU.N: Quote, Profile, Research) , the International Monetary Fund, the New York Stock Exchange and the World Bank were included in a "high" level threat alert by the Department of Homeland Security, which said the attacks on these landmark financial buildings in New York City, Newark, New Jersey, and Washington, D.C., could come from al Qaeda.

The warnings drove U.S. crude oil prices to a record high of $43.94 a barrel earlier in the day before prices eased a bit to settle Monday at $43.82, up 2 cents. Higher oil prices typically cut into corporate profits, as crude is a vital component of transport and manufacturing.

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