Still-Hot Techs Take Nasdaq to Another Record; Dow Falls
Nasdaq scored its ninth record close in 10 sessions on Thursday, but blue chips couldn’t get their motor running even with the bond market on holiday.
The technology-dominated Nasdaq composite surged 41.33 points, or 1.3%, to a record 3,197.29--lifting its year-to-date gain to 46%.
For those keeping score, Nasdaq’s 1999 gain follows a 39.6% jump in 1998 and a 22% rise in 1997.
But the Dow Jones industrials eased 2.44 points to 10,595.30 on Thursday, and losers outnumbered winners by 17 to 13 on the New York Stock Exchange. On Nasdaq winners and losers were about even.
Bond yields, which have been edging higher in recent sessions as the Federal Reserve’s policy meeting next Tuesday looms, weren’t a distraction for blue chips on Thursday: Bond markets were closed for the Veterans Day holiday.
The continued strength in Nasdaq could well be coming at the Dow’s expense, some analysts say: Laggard money managers may be rushing to add tech highfliers to their portfolios, and they may be doing so with cash raised in selling non-tech issues.
For example, while the Nasdaq index has surged 3% this week alone, Coca-Cola has fallen 2.4%, to $56.75, and DaimlerChrysler has slumped 5.7%, to $71.06.
If tech-stock investors are worried about a possible Fed rate hike on Tuesday, they obviously aren’t showing it. Wireless technology giant Qualcomm rocketed $25.94 to a record $345.50 on Thursday, bringing its year-to-date gain to more than 1,200%--the equivalent of the Dow rising to 137,000.
Even Microsoft managed to rally for the first time since a federal judge last Friday ruled that the company is a monopoly. The stock gained $2.50 to $89.63 after Microsoft announced a deal with Tandy, which surged $4.19 to $69.38.
The bulls are running again in more than the Nasdaq market: Stocks hit record highs Thursday in Mexico City and Paris and rose strongly across Europe and Asia.
In Mexico, the IPC index leaped 2% to 6,086.30. Mexican treasury bill yields have recently declined to their lowest level since 1994, boosting optimism about the economy’s growth potential.
In Paris and much of Europe, strong corporate earnings reports and an ongoing merger wave are luring more buyers to stocks.
But in Tokyo, the Nikkei-225 index pulled back 1.3% from a 26-month high as some traders expressed disappointment with the size of the government’s latest economic-stimulus package.
Among Thursday’s highlights:
* Tech leaders doing what they do best included Cisco Systems, up $4.25 to a record $83.75 after its strong earnings report on Tuesday; Oracle, up $3.19 to a record $62.06; chip maker Conexant Systems, up $5.25 to $63.81; and Vitesse Semiconductor, up $5.38 to $53.50.
Also, Sun Microsystems gained $1.56 to $114.75. After the close of trading it said shareholders OKd plans for a 2-for-1 stock split.
* Hot Southland tech stocks included Santa Barbara-based messaging-software firm Software.com (ticker symbol: SWCM), which leaped $17.44 to a record $95.94, though there was no apparent news.
* Despite the strength in tech leaders, Internet shares were under pressure. Yahoo fell $4.56 to $193.13, and America Online lost $3.75 to $142.25.
* United Parcel Service continued to advance on its second trading day. It rose $6.75 to $75 after soaring from $50 in its debut on Wednesday.
Among new issues that began trading on Thursday, Internet security firm SonicWall (SNWL) surged $12.06 to $26.06. Also, semiconductor firm Sage (SAGI) jumped $9.75 to $21.75. But private-school operator Edison Schools (EDSN) saw its shares edge up just 6 cents to $18.06, after falling to $17.75 at one point.
Market Roundup, C6
