Soaring Tech Sector Lifts Market
U.S. stocks rallied, led by technology shares, as investors bet they will have the fastest profit growth. The Nasdaq composite index surged to its first close above 5,000.
“They are not cheap, but money is chasing growth,” said Brian Kirkpatrick, a money manager with Bridges Investment Counsel in Omaha, Neb.
Nasdaq climbed 149.60 points, or 3.1%, to a record 5,046.86, after crossing the milestone initially during trading Tuesday. The Standard & Poor’s 500 index gained 34.99 points, or 2.6%, to 1,401.69, as drug shares rose with software and telecommunications stocks.
The Dow Jones industrial average gained 154.20 points, or 1.6%, to 10,010.73, rebounding from an early drop. Four stocks rose for every three that fell on the New York Stock Exchange.
The Russell 2,000 index of smaller companies powered to its 14th record high this year.
The yield on 30-year Treasury bonds dipped slightly.
Among the equity highlights:
* Major tech names leading the day’s rally included Cisco Systems, up $6.94 to $139.31; Microsoft, up $4.44 to $100; Dell, up $3.50 to $50.44; Compaq, up $1.56 to $28; Hewlett-Packard, up $11 to $151.88; and Texas Instruments, up $8 to $180.
* I2 Technologies, a maker of software that helps companies schedule manufacturing, gained $30.25 to $220.88.
* America Online, which is buying Time Warner, gained $6.50 to $61.38 after Stephen Case, AOL’s chairman, said the No. 1 online service provider is discussing an alliance with AT&T.;
The two companies could jump-start high-speed Internet access in the U.S. if the two form a partnership to jointly sell each other’s services, Case said. AT&T;, the largest U.S. long-distance phone company, eased 38 cents to $52.63.
* The Amex disk drive index climbed 11%, its best day since Nov. 10. Komag gained 81 cents to $3.44 and Read-Rite climbed 66 cents to $4.44.
* Some “old economy” stocks, including International Paper and 3M, fell, keeping the Dow’s gain smaller than Nasdaq’s and S&P;’s.
IP fell $1.27 to $34.75 and 3M fell $1.63 to $80.94.
* Health-care and drug companies rose for a second day as investors bet they have fallen too far this year.
Bristol-Myers Squibb, down 16% this year, rose $6 to $53.75, and Merck, which has lost 9%, gained $4.31 to $61.13.
* Software.com, which supplies e-mail systems to Internet service providers, rose $32.69 to $146.81 after it agreed to buy closely held Atmobile.com for $428 million in stock to gain its software for wireless Internet messaging.
* Orapharma (ticker symbol: OPHM), which develops treatments for mouth infections and disorders, rose $13.25 to $31.25 in its first day of trading.
* Network Solutions rose $71.06 to $494.50. VeriSign, a maker of Web-security software, agreed to buy the issuer of Internet addresses for $17 billion Wednesday. VeriSign rose $37.75 to $240.75.
* NaviSite jumped $34.94 to $300.94 after announcing a 2-for-1 stock split effective April 5 for holders of record March 22. The company, which hosts Web sites for companies, also reported its second-quarter loss narrowed to 41 cents a share. Analysts had expected a loss of 63 cents. Internet venture capital company CMGI, which has a majority stake in NaviSite, rose $6.88 to $145.38.
* Redback Networks rose $32.19 to $359.88. The maker of networking equipment unveiled a 2-for-1 stock split effective April 3 for holders of record March 20.
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Market Roundup, C5
