SUSIE GHARIB: Encouraging news about the economy today failed to lift spirits on Wall Street. The Dow gained only 5 points and the NASDAQ added 10. With the year winding down, tax-selling dominated trading and overshadowed numerous upbeat economic reports. As Erika Miller reports, there are signs that the US economy is shaping up for a better 2002.

ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: The only thing investors like better than a positive economic report is a slew of positive economic reports all in one day. The most encouraging was a sharp and unexpected increase in consumer confidence.

MAUREEN ALLYN, CHIEF ECONOMIST, ZURICH SCUDDER INVESTMENTS: The only thing you can say about Americans is "unsinkable." I mean, people are really excited and pleased about what's going on. And I think they feel really confident about themselves as a country.

MILLER: The Conference Board Index surged more than 8 points in December to 93.7. What's more, expectations for the future rose sharply as well, to 91.5 from 77 in November. The nation also got encouraging news from the manufacturing sector, one of the weakest areas of the economy. Although orders for durable goods fell by 4.8 percent in November, that was less than expected. And excluding the transportation sector, orders actually rose. However, the value of durable goods orders is still down by more than 25 percent from the June 2000 peak.

NEAL SOSS, CHIEF ECONOMIST, CS FIRST BOSTON: Manufacturing has been hammered, to put it bluntly, in the last 18 months or so. Technology, most severely, autos, a few other sectors, just hammered. I wouldn't describe the current circumstance as buoyant, but it certainly does seem that the worst of all of that is behind them.

MILLER: One of the few bright spots in the economy has been the housing market, and new data show the sector continued to grow in November: first, sales of existing homes rose 0.6 percent, and second, new home sales soared by more than 6 percent, the largest gain in almost a year. But economists warn it will take more than just strong housing sales to pull the economy out of recession.

ALLYN: If you haven't gone down, you can't come up. So we can't look for housing to really lead the recovery because it was never a part of this recession at all, and still isn't.

MILLER: Analysts say the underlying message in today's data is that the economy appears to be bottoming. That doesn't necessarily mean boom times are around the corner, but it could mean that we're nearing the end of recession. Erika Miller, "NIGHTLY BUSINESS REPORT," New York.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

JEFF YASTINE: Financial planners are urging investors to take more responsibility for their retirement plans in this weak economy. Many retirement plans have been hit by stock losses this year. And as Diane Eastabrook reports, a growing number of employers are cutting their contributions they make to 401(k) plans.

DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: For the US steel industry, 2001 has been a dismal year. For American Grinding & Machine, 2001 has been perhaps the worst year in its 60-year history. Plummeting sales and falling prices for steel products forced the family-owned firm to lay off 12 of its roughly 100 employees last summer. Then, American Grinding did something it thought it would never do: suspend the company match to its employee 401(k) plan.

ALAN TE RONDE, CHAIRMAN, AMERICAN GRINDING & MACHINE COMPANY: We really didn't want to suspend the match at all, but it came down to being able to preserve as many jobs as we possibly could. And we made the decision that on a temporary basis that it was better to protect as many jobs as possible and suspend the match.

EASTABROOK: American Grinding is one of many firms, including Ford Motor Company (F), suspending company contributions to retirement plans in an effort to cut costs and preserve profitability. David Wray is president of the 401(k) Profit Sharing Council of America. He says in many cases, a company match to a 401(k) plan is contingent on a firm's profitability. But Wray believes employees are often unaware of this.

DAVID WRAY, PRESIDENT, PROFIT SHARING/401(k) COUNCIL OF AMERICA: They clearly need to read their plan, and if there is a variable contribution, which there may be, then they need to take that into account when they make their overall long-term plan.

EASTABROOK: Financial planner Skip Gianopulos says the impact a suspended or canceled match has on a retirement plan depends on an employee's age. He says changes to a company match should be a red flag to all employees to reexamine their retirement goals.

SKIP GIANOPULOS, SR. VICE PRESIDENT, HARRIS TRUST & SAVINGS BANK: That might include increasing contributions that they're making to their 401(k) plan. For individuals that are closer to retirement, this is still an opportunity to take a second look at their retirement plans and make sure that they are fully funded. By having this drop in funding, it's going to put more responsibility on the individual to provide their own financial security.

EASTABROOK: American Grinding says it will restore the company match to the employee 401(k) program, but only after it sees at least two consecutive quarters of sales growth. Diane Eastabrook, "NIGHTLY BUSINESS REPORT," Chicago.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

SUSIE GHARIB: As we approach the year 2002, the recording industry is making big changes in how it does business, especially online business. This month the industry launched two new pay services. Stephanie Woods looks at Pressplay and MusicNet.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: It was the pressure of consumers getting music free online that forced the major record labels to finally put together pay services of their own. It's an idea customers here at the Cyberstop Cafe say they'd be willing to try.

UNIDENTIFIED CONSUMER: If I can get all the songs I want for $25 a month, I'd pay for that.

UNIDENTIFIED CONSUMER: For me, it would suit my needs. For what I would need at home it would be perfect.

WOODS: There are two industry backed services now up and running. Launched in early December, MusicNet is a coalition of RealNetworks (RNWK), AOL Time Warner and Bertelsmann's EMI Group (EMIPY.OB). Customers can buy music online through RealNetworks or AOL. Pressplay is a partnership of Sony (SNE) and Vivendi's Universal Music (V). It's offered through MSN and Yahoo! (YHOO) for a monthly fee. Pressplay's CEO Andy Schuon says it's a way for the record industry to grow in the future.

ANDY SCHUON CEO, PRESSPLAY: The appetite for music online is immense. I mean there are billions of files illegitimately traded every month. So we know that people want to get their music and accumulate it on their computer and if we can provide them with a service that's compelling, fun, has the music that they want and gives them the flexibility to do with it what they want, then I think we're off to a good start.

WOODS: The recording industry successfully sued to shut down the number one pirated site, Napster, last summer. But dozens of sites offering songs and the ability to swap music still exist. Analysts say the new services offered by the record labels aren't competitive with the free sites.

ROB MARTIN, ANALYST, FRIEDMAN, BILLINGS, RAMSEY: I mean there are literally dozens. You could count a dozen sites that look exactly like Napster out there with millions of users each that add up to a far greater market and user base than either Pressplay or MusicNet could ever hope to garner.

WOODS: Unlike Napster, these other sites don't maintain a central computer that coordinates file swapping, which may make it more difficult for the recording industry to shut them down. Neither MusicNet nor Pressplay have a complete catalog of music. Until they do and let music fans use it as they please, analysts warn, customers may not buy it. Stephanie Woods, NIGHTLY BUSINESS REPORT, Washington.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

SUSIE GHARIB: Our last market monitor guest for 2001 has a very positive forecast for the new year. He's Brian Finnerty, managing director and market strategist at Unterberg Towbin. He joins us from his firm's trading floor. Nice to see you, Brian.

BRIAN FINNERTY, MANAGING DIRECTOR, C.E. UNTERBERG, TOWBIN: Hi, Susie. Good to see you, too.

GHARIB: Brian, you have a reputation for being bullish but you tell me you're even more bullish for 2002. Tell us your reasons why.

FINNERTY: Well, Susie, I think the market is telling us something right now in the way it's acting. And since the late fall, since about September 21 we've had a big move, particularly in the NASDAQ, but all the indices have gone higher and everyone's waiting for a pullback, Susie. And that tells me investors, market players-by that I mean mutual fund portfolio managers, hedge funds and individuals as well are all under invested. I think they feel they missed the boat on the way up. They're looking for a correction, myself included, would love to see a correction, so that we can get back in on the ground floor. But I don't know that the market is going to allow us to do that. I think it's going to climb higher, much higher before it corrects.

GHARIB: Now, you're calling for a NASDAQ by the end of, by December of 2002 to be around the 2,800 level, the Dow to be at the 11,000 level. You know, skeptics would say look, valuations are too high, earnings are going to be very weak and the economy is also weak. So, you know, they just don't see that kind of momentum there.

FINNERTY: Susie, that's a very good point. But if you look at those numbers, the NASDAQ climbing back, I think it's going to stall out around 2,300 first. I think it'll get through that before going to 2,800. That's only returning to last year's highs. But what I think is going to happen, I really believe that the, you know, the Fed's monetary policy that's been implemented is going to fuel that flame going higher. The Dow getting back to 11,000 could actually be a little bit easier a task. The Dow has under performed NASDAQ in this, since the bottom, since this rally began, and I think the Dow can make it there a bit easier.

GHARIB: I know you're a really big technology investor at Unterberg, Towbin. Tell us what technology stocks look attractive to you going into the new year.

FINNERTY: Well, Susie, there's a lot of them. You've got to pick them by sectors. We like semiconductors. We like some of the other areas as well. In semiconductors one of our favorites is a company called Kopin, (KOPN). They're a chip manufacturer to the wireless hand set industry. They also do cyber display. Big growth there. We are a banker and a research analyst for them. In the optical space, we like JDS Uniphase (JDSU), believe it or not, battered, down and out, down to eight and change from over 100, but they're the largest maker of optical components. They've got their financial house well in order. Their balance sheet is in great shape. When that fiber optic market turns they'll be a beneficiary.

GHARIB: What kind of target price are you looking for for JDS?

FINNERTY: Well, right now I think we could say mid teens conservatively if and when it starts moving. And I think for KOPN we could see high 20s on that.

GHARIB: So you like semiconductors even though they've had a huge run up over the last couple of weeks?

FINNERTY: Well, that's why I want to be a bit selective. We do like the group. But I think some in that group, mainly some of the equipment manufacturers, might be a little ahead of themselves, companies like Applied Materials (AMAT), which is trading at about five times book value right now as opposed to some others in that sector that are only two times book. So there are values in that sector but you've got to know which ones to look for.

GHARIB: Tell us where else do you see value in other technology stocks.

FINNERTY: Some other techs we like are what we call that EMS group, the electronic manufacturing services group. They've been hit pretty hard lately, Susie. Our favorite there is Jabil Circuits (JBL). There's others in that group. Celestica (CLS), we like, and Flextronics (FLEX) as well.

GHARIB: Anything in the PC area or hardware stocks?

FINNERTY: We really, we don't favor Dell (DELL). Dell has had a heck of a move this year. We're not positive on it. We think they're going to run into big margin problems so we're not high on Dell. Compaq (CPQ) is probably washed out. But I'd rather buy it than sell it. But I'm not going to bang the table on Compaq.

GHARIB: OK. Real quickly, my last question to you, for investors, cautious long-term investors looking for one really good technology stock to buy now and hold for a year, what would be the name you'd give them?

FINNERTY: Well, to buy and hold for a year, I gave you the one, Kopin, KOPN. I like that a lot. I'd like to give you a biotech stock that I like a lot to buy and hold for the year, and that would be Novavax (NVAX). They're a biopharmaceutical company specializing in a lot of the female hormone drugs. We like NVAX a lot. We're a banker there as well, Susie.

GHARIB: OK, you've given us a lot to think about. Thank you so much, Brian, and happy new year.

FINNERTY: You too, Susie. Thank you.

GHARIB: We've been speaking with Brian Finnerty of C.E. Unterberg, Towbin.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

JEFF YASTINE: Well, today's economic data looked like a nice setup to finish out the so-called Santa Claus rally on a high note, but the excitement didn't last. The blue chips did manage to squeak out a gain, though. The Dow Jones Industrial Average opening strongly on the back of those consumer confidence and housing numbers. It gained 50 points in the first hour of trading. Big board volume was about even with yesterday. Advancers had about an 8 to 5 lead on decliners. But the rally started to fade soon after, and by noontime, the Dow had settled back to its opening levels. In afternoon trading, the NASDAQ also drifted lower. Again, not much news, and light volume weighing on the index. And in late trading, more of the same as the indexes basically went to sleep. And the Dow managing to squeak out a gain of 5.68 points at 10,136. In this shortened holiday workweek, the Dow was unchanged on Christmas Eve, but rose in every session thereafter for a net overall gain of 101 points, or about 1 percent. Today the NASDAQ rising nearly 11 to 1987. And for the week, it gained almost 41 1/2 points, or about 2 percent.

Big board volume topping the 900 million-share mark.

Transports gaining nearly 6 points.

Utilities edging up about 1 2/3 points.

And the Closing Tick very bullish at +804.

In the broader market, the S&P 500 advancing nearly 4.

The 100 climbing nearly a point..

The MidCap 400 gaining about 4 1/3 points.

And the Bridge CRB ending fractionally lower.

The New York Stock Exchange Composite Index and Value Line each ending up more than 2 points.

A 1-point for the Small Caps.

And the broadly-based Wilshire 5000 gaining nearly 44 points.

Well, the gains in stocks came at the expense of bonds, which fell as today's data revived traders' fears that additional cuts in interest rates may not be forthcoming from the Federal Reserve. At the same time, holiday trading volumes are so thin, it's easy for prices to be pushed around more so than at other times. So bonds also felt some impact from OPEC's decision today to cut oil production rates. We'll have more on that in a moment. Corporate and tax-free issues were mixed, but Treasuries moved lower across the board.

The 5-year note dropping 4/32.

The 10-year off 10/32.

The 30-year bond lower by more than a full point and the yield back up to 5.54 percent.

And the Lehman Brothers long bond index losing 4 points on the day.

Well, once again the Dow holding above 10,000 nicely, one trading day left to go in the year. The Dow gaining nearly 6 points on the day. Advancers holding its lead over decliners, as it has all week, by a nearly 2 to 1 margin. 119 new yearly highs; just 14 new lows.

Liberty Properties Trust (LRY) rising $0.07 on about 12 million shares. This is a dividend play for this real estate investment trust.

Lucent (LU) edging up $0.04. The company will not be awarding bonuses this year to the chairman or top executives of the troubled telecom equipment maker. The shares are down over 50 percent for the year.

EMC (EMC) slipping $0.07.

AOL Time Warner (AOL) gaining $0.67.

G.E. (GE) losing $0.20 on the day.

NorTel (NT) climbing $0.16. This one's down 75 percent for the year.

AT&T (T) rising $0.19.

Solectron (SLR) advancing $0.16.

Motorola (MOT) gaining $0.09.

And Qwest Communications (Q) finishing out the day up $0.56.

Among our widely helds, Allegheny Energy (AYE) falling $0.69. The utility holding company cut its 2001 earnings projection because of the unusually mild weather it's had in its area.

American Express (AXP) rising $1.05, hitting a nearly four month high there.

Shares in Sony (SNE) jumping $2.25. Fujitsu (FJTSY) and Sony may broaden their Internet alliance. There are reports unconfirmed by Sony that it's buying Fujitsu's Internet service unit for about 100 billion yen.

Target (TGT) picking up $1.60. Stronger than expected holiday sales prompting USB Piper Jaffray to raise its one year price target to $48.

Waters (WAT) gaining $0.80. As we reported yesterday, the stock is being added to the S&P 500.

Xerox (XRX) ending up $0.60. That's getting another cash injection from G.E. Capital, $340 million. It's the second of a three part loan package about $2 billion total.

Omega Healthcare (OHI) gaining $1.20. A.G. Edwards believe this is a delayed reaction to the company's latest debt restructuring. It rates the stock a "hold."

Manufacturers' Services (MSV) rising $1.04. The electronics components maker is getting a new chairman and CEO.

Sunrise Assisted Living (SRZ) gaining a little over 3. The company is being added to the S&P Small Cap 600 Index. It replaces Commerce Banc Corp.

Sonic Automotive (SAH) rising $1.83. Another retailer getting a lot of sales mileage out of the zero percent financing incentives from Detroit.

A.C.L.N. (ASW) ending off $1.80. This saga over alleged accounting concerns going on. Several class action lawsuits have been filed on that one.

And Trenwick Group (TWK) falling $0.57. Moody's downgrading the company's debt rating.

The Nasdaq Composite ending up nearly 11 points, closing at 1,987. Volume swelling to 1.3 billion shares and advancers outpaced decliners by a 4 to 3 margin.

Microsoft (MSFT) edged up $0.02 on the day.

Intel (INTC) dipping $0.43. The big cap tech stocks were a rather mixed bunch today.

Cisco Systems (CSCO) rising a $0.05.

Su