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A Year Later, Many Sectors Still Struggle but Some Show Big Gains

September 11, 2002|TOM PETRUNO | TIMES STAFF WRITER

Most investors who plunked down money for stocks Sept. 10, 2001--one day before the terrorist attacks--still are far underwater one year later, based on the performance of major market indexes since then.

But some stock sectors have scored strong gains since a year ago, after diving initially with the broad market when trading reopened Sept. 17.

Within the blue-chip Standard & Poor's 500 index, the winners since Sept. 10 have included such disparate stock sectors as can and bottle makers, home builders and casino companies.

The S&P 500 index was down 16.8% from Sept. 10 through Tuesday. The Dow Jones industrial average was down 10.4% in the period and the Nasdaq composite index was down 22.1%.

Stock trading was suspended for four sessions after the attacks, and when it resumed Sept. 17, the market suffered heavy selling, driving nearly all shares lower.

But buyers returned in force the week of Sept. 24 and fueled a powerful rebound in stocks that carried into January.

The broad market sank again in spring and summer, reaching five-year lows in midsummer. But one year after the attacks, some investors who bought just before the attacks are solidly in the black, if they held on.

Can and bottle makers are the top-performing sector in the S&P 500 since Sept. 10, with a gain of nearly 50%. There are two stocks in the group: Ball Corp. and Pactiv Corp.

Shares of Ball have surged from $28 a year ago to $53.82 Tuesday, as the firm's earnings have benefited from strong shipments of plastic bottles to water companies. Ball also is on an expansion binge: It recently announced plans to buy the No. 2 maker of beverage cans in Europe.

Home builders also have posted powerful gains over the last year, as the housing market has remained robust. The average stock in the S&P 500 home-builders index is up nearly 49% since Sept. 10.

Other groups that have risen sharply include managed healthcare companies, as earnings in that industry have soared; gold miners, as the metal's price has jumped; and brewers, a classic "defensive" investment in a tough economy.

One surprise on the list of top-performing sectors is the casino group. The stocks crumbled after Sept. 11 as many investors feared that Las Vegas and other gambling sites would suffer from a falloff in travel. But business has been better than many analysts expected.

On the down side, the biggest losers among S&P 500 sectors since Sept. 10 are utility firms, technology firms and telecom firms.

Electric and gas utilities have been pummeled in part by the fallout from Enron Corp.'s collapse.

The telecom sector was in a depression even before the attacks, and business only got worse afterward for many companies, amid a glut of supply.

The average wireless services company in the S&P 500 is down 67.5% from Sept. 10. The average telecom equipment maker has fallen 48.6%.

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