NEW YORK, Nov 10: Stocks eked out small gains on Friday, but it was enough to lift the blue-chip Dow Jones industrials to a close above its pre-September 11, levels for the first time since the terror assault.

The Dow index rose 20.48 points, or 0.21 per cent, to end at 9,608, just barely above its September 10 level of 9,605.51.

The technology-heavy Nasdaq composite and broad-market Standard and Poor’s 500, which had already recovered the losses seen in the wake of the terror onslaught, also posted minor gains.

The Nasdaq moved up a fractional 0.71 point to 1,828.48 and the S and P 500 edged up 1.77 points (0.16pc) to 1,120.31.

The major indices drifted between positive and negative territory for most of the session, finally managing small gains at the close.

Analysts said the market lacked direction with investors unwilling to make any bold moves in a market that some observers feel may have risen too sharply and too quickly in the weeks following September 11.

According to Charles Pradilla, an investment strategist with SG Cowen, the see-sawing movement can be put down to a “battle” between those investors who feel that the market has rallied too strongly and those who are more optimistic on the prospects for the US economy and corporate profits.

Today we have seen a battle between the profit takers and those who believe that lower interest rates will lead to even stronger growth ahead, he said.

Economic data offered a mixed picture on the US business environment.

The University of Michigan said its index of consumer sentiment rose to 83.5 in a preliminary November reading from 82.7 in October, surprising economists who were looking for a decline.

However, the Producer Price Index fell 1.6 per cent last month, the steepest fall on record, and an indication of the depth of the slump consuming the economy. Stripping out energy and food, the PPI dropped 0.5 per cent.

News of progress on the war in Afghanistan gave the market a minor boost at midsession, said Alfred Goldman of AG Edwards.

The Dow also had a positive response to a new report on consumer sentiment that was stronger than expected.

Oil shares were higher with ExxonMobil up 75 cents at 40.25 and ChevronTexaco up 1.90 to 89.49 after news that Saudi Arabia, which owns approximately three quarters of known oil reserves, proposed a bigger than expected output cut and that Russia, a non-Opec country, may go along with the reduction in world supply.

ChevronTexaco affiliate Dynegy jumped 2.26 to 38.76 on reports it was near a deal to buy beleaguered energy trading firm Enron, up 22 cents to 8.63.—AFP