Tech Rally Propels Nasdaq; Dow Is Flat

Technology stocks rallied Wednesday despite a fresh plunge in shares of the Internet’s largest retailer, while the broad market ended mixed.

Treasury bond yields fell on new signs of economic gloom.

On Wall Street the Nasdaq composite jumped 27.10 points, or 1.6%, to 1,731.54, highest since Sept. 5.

But the Dow industrials edged up just 5.54 points to 9,345.62, and the average New York Stock Exchange issue eased 0.3%.

Rebounding tech stocks continued to attract investors even as Amazon.com, a symbol of the Internet economy, dropped $1.91, or 20%, to $7.64 in the wake of a dismal quarterly sales report.

“I’d give the market an ‘R’ for resiliency,” said Bryan Piskorowski, market commentator for Prudential Securities.

Winners topped losers by 19 to 16 on Nasdaq, while on the NYSE losers had a 17-to-14 edge. Volume was moderate.

Tech shares leading the rally included Nextel Communications, up $1.29 to $8.69 after reporting quarterly results; chip maker Broadcom, up $4.34 to $35.79; Juniper Networks, up $3.12 to $27.01; Cisco Systems, up 82 cents to $17.23; and Homestore.com, up $1.95 to $6.50.

On the downside, blue chips were rattled by post-earnings-report sell-offs in Eastman Kodak, down $3.46 to $30.71; Exxon Mobil, down $1.01 to $39.86; and AT&T;, down $1.36 to $16.34. All are in the Dow index.

“It’s one of these markets where you have to be very nimble and be constantly looking over your shoulder,” said Gary Kaltbaum, market technician for Investors’ Edge Partners.

Utility stocks continued to be hit hard by sellers. Enron fell $3.38 to $16.41. After the market closed, the company said it replaced its chief financial officer amid a federal probe of certain transactions.

Other utility losers included Williams, down $2.15 to $25.90; and American Electric Power, off 55 cents to $42.59. Edison International, parent of Southern California Edison, slipped 7 cents to $15.14.

Strong sectors included banks, defense and biotech.

In the bond market Treasury yields were lower across the board after the Federal Reserve’s latest compilation of regional economic health showed marked weakness.

The 10-year T-note yield slid to 4.6% from 4.64% Tuesday. The two-year T-note fell to 2.69% from 2.77%, even as the government sold a record $19 billion of new two-year notes.

Some analysts said bond yields could fall much further if the world’s central banks sense that deflation may be an issue in 2002.

Market Roundup, C7-C8