Dow Jumps; Tech Shares See a Rebound
Stocks sent investors home for Christmas on a happy note, zipping into the close of Tuesday’s abbreviated session led by a rebound in bellwether technology shares.
The Dow Jones industrial average rose 33.83 points to 6,522.85, moving within 25 points of Nov. 25’s all-time best close at 6,547.79. It was the sixth straight winning session for the barometer of 30 big U.S. companies, which is up more than 1,400 points, or nearly 27.5%, on the year with four trading days left.
The technology-laden Nasdaq market shot higher over the last half hour as bargain hunters bid up computer-related issues that had dipped on profit-taking in the previous two sessions.
“A few stocks got hit hard yesterday and they’ve rebounded a bit, but it’s not anything to brag about,” said Don Hays, director of investment strategy at Wheat First Butcher Singer in Richmond, Va. Aside from technology, he said, “there was no group personality. It was just a mixed bag.”
Analysts attributed much of the session’s positive tone to seasonal influences and the light, preholiday trading. Tuesday was the slowest-trading day since the day before Thanksgiving.
It was a “traditional updraft in a light-volume environment,” said Alan Ackerman, senior vice president at Fahnestock & Co. “At this time of year, you tend to see a pre-Christmas rally. Many sellers have completed their tax selling.”
The Dow’s strongest component was American Express, up 2 3/4 at 59 5/8 amid speculation that General Electric may be mulling a takeover of the $28-billion company. GE officials were unavailable for comment. American Express spokesman Mike O’Neill declined to comment on Tuesday’s speculation. GE rose 1 to 102.
The Standard & Poor’s 500-stock index rose 4.11 points to 751.03, the NYSE’s composite index rose 1.71 points to 395.00, and the American Stock Exchange’s market value index rose 0.37 point to 581.35.
The Nasdaq composite index rose 8.11 points to 1,287.63, bolstered by late rallies from Intel, up 3 at 135 1/4, and Microsoft, up 1 1/8 at 84 7/8.
Among Tuesday’s highlights:
* AT&T; rose 1 1/2 to 41 3/8 as the NYSE’s second most-active issue amid optimism new president John R. Walter will turn things around at the telecom giant.
* Computer makers recovered from two sessions of profit-taking and concerns that holiday sales may not be as strong as hoped. Dell rose 2 1/4 to 54 and Gateway 2000 rose 1 7/8 to 56 5/8. Compaq rose 2 1/8 to 74 3/4 and IBM, a Dow component, rose 1 1/2 to 155 3/4.
Digi International tumbled 3 7/8 to 8 7/8 after the maker of data communications hardware restated its fourth-quarter earnings and warned of weaker-than-expected fiscal first-quarter profit.
* Florida Panthers Holdings soared 4 1/4 to a record 17. On Monday, the owner of the National Hockey League Florida Panthers agreed to buy two Florida resorts for $107 million in stock.
* TRO Learning skidded 6 3/4 to 10 1/2 after the maker of educational software reported unexpectedly weak fourth-quarter earnings as the company booked more orders than it shipped.
* BellSouth, which agreed to buy at least 54% of Peruvian cellular phone company Tele 2000 for $100 million, gained 1 1/4 to 39 7/8.
Overseas, Tokyo’s Nikkei stock average tumbled 2.7% and London’s FTSE-100 rose 0.1%. German financial markets were closed.
