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Wall St.'s home stretch
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December 23, 2001: 7:00 a.m. ET
As year-end nears, stocks appear stuck in December range.
By Jake Ulick
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NEW YORK (CNN/Money) - With little time left in a tough year, investors this week find out if another round of corporate profit warnings will continue to stall the market's two-month run.
Hundreds of companies have readied investors for financial disappointments, with more shortfalls expected as the fourth quarter draws to a close.
"I think you will see more of that coming," said Mike Murphy, head of equity trading at Wachovia Securities, referring to warnings.
The stock market, after surging since Sept. 21, has made no real progress in December and is on track for its a second straight year of losses. That hasn't happened since 1974.
Still, Murphy expects modest gains in the days ahead as investors, betting on economic recovery, fret they will miss the next rally. "There's still a lot of cash out there," he said.
But very little time remains this year. The U.S. stock market closes at 1 p.m. Monday ahead of Tuesday's Christmas holiday. After that, 2001 has only four full sessions left.
More than 518 companies have already warned about shortfalls for the fourth quarter, according to earnings tracker First Call, which said the pace of technology warnings has actually been slowing.
About 111 technology companies have warned about the quarter's results, First Call said, down from 149 at this time last quarter and 199 the quarter before that.
Stocks ended mixed last week, with the Dow industrials rising 2.3 percent while the Nasdaq composite index little changed, down 0.4 percent.
But the Dow, after rising 19.6 percent between Sept. 21 and the end of November, has trended nearly flat this month. That's also the case with the Nasdaq, which rose 37 percent from its trough through last month.
No major companies are scheduled to release profit reports this week. But Friday brings a batch of economic indicators.
November durable goods orders probably fell about 5.5 percent after a record 12.8 percent jump the previous month, according to economists surveyed by Briefing.com.
Consumer confidence is expected to have edged higher in December in the Conference Board report also due Friday.
And existing home sales are forecast at an annual rate of 5.17 million for November, unchanged from the prior month. New home sales, meanwhile, are forecast to have risen to an annual rate of 895,000 last month from 880,000.
Last week's market action came amid signs that the economy's worst days may be over. The number of Americans filling for first-time jobless claims fell for a third straight week while a gauge designed to forecast the economy's direction saw its second straight gain in November.
Consumer confidence jumped to a four-month high in December, according to the University of Michigan, which conducts a widely followed survey.
The Federal Reserve has cut interest rates 11 times this year to help pull the economy out of recession. But an economic stimulus package that passed in the House last week failed in the Senate, where Democratic and Republican leaders could not agree on how best to spur growth.
Still, Tracey Eichler, investment strategist at UBS Warburg, calls stocks undervalued by about 20 percent. She expects that equities will do better than cash and bonds in the months ahead, something that hasn't happened since 1999.
"There's no other asset class out there," Eichler told CNNfn's Before Hours.
Investors certainly hope so. A stock market decline in 2002 would be the first three-year tumble since 1941. 
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