Nasdaq Rallies to a Record, but Broad Market Is Mixed

From Times Staff and Wire Reports

Technology stocks lifted the Nasdaq composite index to a new high Wednesday as a tame inflation report and an upbeat outlook from Intel raised Wall Street's optimism about computers and the Internet.

The Nasdaq surged 39.90 points, or 1.4%, to 2,818.13, topping the previous high set Friday.

But that momentum didn't catch on among blue chips, which struggled through most of the day. The Dow Jones industrial average eased 26.92 points to 11,148.10.

Still, winners outnumbered losers by 15 to 14 on the New York Stock Exchange and by 22 to 17 on Nasdaq.

Tech stocks led the way after semiconductor leader Intel forecast a strong second half of 1999, despite reporting weaker-than-expected quarterly earnings Tuesday. Intel shares gained $2.63 to $68.

The tech sector also got a lift from reports that fund managers at Fidelity Investments were putting money back into the sector, after backing off earlier this year.

Stocks in general were helped by the government's report of a dip in wholesale prices in June--suggesting that inflation remains subdued.

In the bond market, yields closed unchanged or slightly higher. The benchmark 30-year U.S. Treasury bond yield edged up to 5.91% from a six-week low of 5.89% Tuesday.

The inflation news, and some strong quarterly earnings reports so far, "continue to paint an optimistic picture" for stocks, said Philip Orlando, chief investment officer for Value Line Asset Management Inc., which oversees $6 billion.

Among Wednesday's highlights:

* Major tech winners included Apple Computer, up $2.25 to $55.94 before its earnings report issued after trading ended; Microsoft, up $1.31 to $94.94; Applied Materials, up $5 to $77.50; and Adobe Systems, up $2.44 to $90.

In the Internet sector, Yahoo rose $2.50 to $159.44 and Amazon.com gained $8.88 to $135. But America Online lost $2.13 to $123.

* Whirlpool rallied $3.13 to $73.94 as the largest U.S. maker of appliances said second-quarter profit rose 23% on higher sales in North America.

* Polaroid tumbled $5 to $23.75 as Chairman Gary DiCamillo said he's taking a "more conservative" stance on its expectations for second-half profit, after the company's second-quarter profit rose 11-fold, matching estimates.

* Iridium World, which owns the first global satellite-telephone network, fell $1.44 to $6.75 after Motorola said it won't invest more money in the system unless others do the same. Motorola slipped $1.63 to $94.88.

* Among new stock issues, Tibco Software, which produces software that improves online communication between businesses and customers, more than doubled in its first trading day. Tibco (ticker: TIBX) catapulted $17.38 to $32.38.

But Internet portal China.com backed off $6.61 to $60.50 after Tuesday's hot debut.

In foreign trading, Taiwanese shares continued to sink amid worries about deteriorating relations between Taiwan and China. The main Taiwanese index slid 3.9%.

*

Market Roundup, C8

Copyright © 2019, Los Angeles Times
EDITION: California | U.S. & World
57°