Tech Investors Shun Suspense, Resume Rally
The wait for the final Microsoft antitrust decision didn’t stop some investors from shopping for tech stocks in general on Wednesday.
The Nasdaq composite index gained 82.89 points, or 2.2%, to 3,839.26, resuming its rally after Tuesday’s profit-taking.
The broader market also was higher. The Dow industrials rose 77.29 points, or 0.7%, to 10,812.86, getting a lift from IBM after an analyst’s bullish statements on the firm’s outlook.
The Standard & Poor’s 500 index rose 0.9%.
Meanwhile, Europe is getting more expensive for Americans every day: The euro continued its rebound, rising above 96 U.S. cents.
On Wall Street rising stocks outnumbered losers by 23 to 17 on Nasdaq, though volume slowed to 1.43 billion shares.
Traders said some investors were pulled off the sidelines after Goldman, Sachs & Co. analyst Laura Conigliaro said IBM saw strong orders in April and May. She also said the company’s personal-computer unit could narrow losses this quarter.
IBM jumped $8.63 to $121 in heavy trading.
“Stocks came on very strongly once they found a catalyst,” said Scott Bleier, chief investment strategist at Prime Charter Ltd. in New York, referring to IBM.
The market ignored a small uptick in bond yields. The 10-year Treasury note rose to 6.15% from 6.13% on Tuesday. A flood of corporate bond offerings this week is taking some buying power away from the Treasury market.
Many investors are awaiting Friday’s government report on wholesale price inflation in May. That may be another crucial piece of data as the Federal Reserve weighs whether the economy has slowed enough to justify a halt to interest-rate increases.
In currency trading, the euro rose to a seven-week high against the dollar, closing at 96.2 U.S. cents, on expectations the European Central Bank will raise interest rates today--heightening the attractiveness of euro deposits.
The euro has rebounded from about 89 cents in May.
Among Wednesday’s highlights:
* Major tech stocks following IBM higher included Apple, up $3.69 to $96.56; Sun Microsystems, up $4.44 to $88.31; Oracle, up $2.94 to $80; Applied Materials, up $4.25 to $93.56; and Gateway, up $1.69 to $54.50.
Microsoft also rose, in advance of the judge’s ruling in the government’s antitrust case. The shares gained 88 cents to $70.50.
But Applied Micro Circuits slid $9.94 to $96.88. William Bendush, Applied Micro’s chief financial officer, said Tuesday that sales to Nortel, the firm’s biggest customer, will slow in the fiscal first quarter.
* Among Internet issues, Yahoo jumped $9.44 to $144.50, Redback Networks gained $11.31 to $117.31 and Juniper Networks surged $23.31 to $224.69.
* The biotech sector, red hot in recent sessions, turned mixed. Immunex jumped $4.20 to $36.31 after it gained federal approval for wider use of a key drug. But genome-related stocks pulled back. Celera Genomics fell $9.25 to $96 and Human Genome Sciences lost $5.88 to $116.13.
* In the retail sector, Circuit City fell further, down $1.31 to $38.31, after diving $12.50 on Tuesday in the wake of the firm’s report on disappointing May appliance sales. Rival Best Buy slumped $4.38 to $62.38.
But Target, which fell with Circuit City on Tuesday, rebounded $2.13 to $59.69.
* Some online brokerage shares gained after Donaldson, Lufkin & Jenrette Inc. analyst Richard Zandi recommended them. E-Trade surged $2.38 to $19.25, Ameritrade rose 75 cents to $13.31, Knight Trading leaped $2.13 to $32.38 and TD Waterhouse added 63 cents to $18.31.
* Airline stocks were higher after the Wall Street Journal said AMR, parent of American, and Delta held merger talks. AMR added 13 cents to $28.44 while Delta surged $1.61 to $52.50.
*
Market Roundup, C13-C14
