Dow Gains as Investors Pause to Catch Breath; Nasdaq Eases

Stocks ended mostly higher Thursday in the final trading session of the holiday-shortened week, though profit-taking continued to weigh on the technology sector’s leaders.

Volume slowed sharply, as many investors--no doubt fatigued from the dramatic market swings of recent weeks--added an extra day to their weekend. Markets are closed today in observance of Good Friday.

In currency trading, the euro’s value slid to a record low for a second day, worrying European central bankers but thrilling American tourists headed across the Atlantic.

The Nasdaq composite index slogged through a relatively calm session to end down 62.53 points, or 1.7%, at 3,643.88. Despite losing 2.3% on Wednesday, the index posted a net gain of 9.7% for the week, thanks to the sharp Monday and Tuesday gains after the previous week’s record 25.3% plunge.

Although selling in tech stock leaders clipped Nasdaq, many “old-economy” stocks in the Dow Jones industrial average enjoyed renewed demand, helped in part by strong earnings reports.

The Dow gained 169.09 points, or 1.6%, to 10,844.05, bringing its gain for the week to 5.2%.

Among broader indexes, the Standard & Poor’s 500 rose 0.5% on Thursday, and the Russell 2,000 small-stock index fell 0.9%.

Winners topped losers by about 5 to 4 on the New York Stock Exchange, and on Nasdaq winners and losers were about even.

As on Wednesday, investors Thursday cashed in some of the best-known tech stocks, which had led Nasdaq’s rebound early in the week. Some of those firms on Tuesday and Wednesday had reported first-quarter earnings that were mildly disappointing to some analysts.

Among Thursday’s losers were Intel, down $3.69 to $115.38; IBM, down $1 to $104; Oracle, down $3.75 to $70.81; and JDS Uniphase, down $6.31 to $85.19.

But the selling did not have much urgency: Trading volume on Nasdaq was just 1.4 billion shares, versus the 2-billion-plus-share days typical in recent weeks.

Analysts noted that many investors seemed to be concentrating on earnings reports and other signs of fundamental strength as they determined which stocks to buy--quite a difference from the “momentum” market of February and early March.

“The market is behaving in a much more normal, more rational manner,” said Bernard Horn, mutual fund manager at Polaris Capital Management.

Among the old-economy names gaining on earnings news were Quaker Oats, up $4.25 to $67.31; McDonald’s, up $2.75 to $35.81; and UPS, up $4.44 to $63.50.

But some tech shares also gained on earnings reports, including Conexant Systems, up $4.44 to $61.69, and Commerce One, up $7.31 to $55.

In the bond market, long-term yields were little changed as the Treasury bought back $2 billion of long-term bonds, continuing its program of using some of the budget surplus to reduce debt.

In currency trading, the hapless euro slipped under 94 U.S. cents in value, a record low. Though the European Central Bank has expressed concern about the currency’s slide, many traders don’t expect the bank to raise interest rates next week, which means the euro could fall further, they say.

Among Thursday’s highlights:

* Internet-related shares turned mixed. America Online fell $1.75 to $60, Inktomi lost $4 to $129.13 and Redback Networks fell $4.75 to $63, but Tibco Software jumped $11.81 to $67.88 and Ticketmaster Online rose $3.19 to $21.44 after its first-quarter earnings report.

* Among old-economy names, aerospace shares were particularly strong, led by Boeing, up $2.81 to $40.06; Lockheed Martin, up $1.81 to $22.69; and Northrop Grumman, up $3.13 to $67.

* Utilities were also back in favor, with Duke Energy up $1.56 to $56.50 and Unicom up 94 cents to $39.50.

* Bank shares were mostly higher, led by Citigroup, up $1.63 to $61.25, and Wells Fargo, up $1.06 to $41.81. But Inglewood-based Imperial Bancorp continued its recent plunge, down $2.94 to $19.19, after reporting first-quarter earnings.

Market Roundup, C7-8