Top Stocks Capitalize On Modest Bounce.(A)

Byline: CHRIS GESSEL

Saddam Hussein's no-show Tuesday helped the stock market take back a chunk of the prior day's losses.

The market looked for direction in the first half of the session. Investors were relieved after a manufacturing survey wasn't as bad as some had feared. But the data fueled only a fleeting rise.

Stocks had fallen nearly flat at 11:36 a.m. Eastern time when headlines started moving that Saddam would make an address at noon. A current message could settle rumors the U.S. had hit the Iraqi dictator with its first cruise missile and precision bomb strikes nearly two weeks ago.

But Saddam was either too busy, too injured or too dead to personally deliver his call for a jihad against coalition forces. Instead, Information Minister Saeed al-Sahaf offered a statement from Iraq's now-elusive leader. "Those who are martyred will be rewarded in heaven," Sahaf read. "Seize the opportunity, my brothers."

The market moved higher well into the afternoon. The S&P climbed more than 1.5%, reclaiming most of Monday's 1.8% loss. Sellers eroded the advance and nearly pushed the market back to its starting point. But a late flurry of buying lifted stocks to moderate gains.

Real-estate lenders and insurance companies helped lead the S&P 500 to a 1.2% increase. The small-cap S&P 600 climbed 0.9%. The tech-heavy Nasdaq trailed with its 0.5% gain.