Bargain Hunting Lifts Tech Stocks
Technology stocks rose Thursday as investors picked up beaten-down bellwethers such as Intel, but blue chips wavered on mixed economic news and continued questions about General Electric’s finances.
“We just got a reality check with the [economic] statistics that came out,” said Donna Van Vlack, director of trading at Brandywine Asset Management.
The blue-chip Dow Jones industrial average recovered from an early 147-point loss to close down 21.73 points, or 0.2%, at 10,479.84. The Standard & Poor’s 500 index, also down most of the session, finished up 1.74 points, or 0.2%, at 1,153.59. The Nasdaq composite index advanced 35.96 points, or 2%, to 1,868.83.
Winners led losers by 17 to 15 on the New York Stock Exchange and by 3 to 2 on Nasdaq. Trading was moderate.
On the economic front, the Federal Reserve Bank of Philadelphia said factory activity in the mid-Atlantic region posted a third straight month of growth in March, but that activity declined from nearly two-year peaks seen in February.
Other data showed U.S. consumer prices rose for a second month in a row and fewer workers are seeking jobless aid, adding to evidence the economy is growing. But the index of leading economic indicators was unchanged in February, ending a four-month string of increases.
Overall, the data relieved some concerns that the Federal Reserve might boost short-term interest rates soon. Long-term bond yields pulled back after rising in the morning. The yield on the 10-year Treasury note fell to 5.36% from 5.41% Wednesday.
GE slid $1.35 to $37.45. The slump came a day after Bill Gross, manager of the world’s largest bond fund, said his firm, Pacific Investment Management of Newport Beach, will not own GE’s short-term debt. He said GE is disclosing too little to investors.
“GE has not had the most transparent accounting,” said Hershel Cohen, manager of the Smith Barney Appreciation fund. “It’s a good company, but could the stock come under pressure? Certainly.”
In other market news:
* Alcon, a unit of Swiss consumer products giant Nestle, rose $1 to $34 in its first day of trading. The eye-care firm trades on the NYSE under the symbol ACL. Nestle rose 75 cents to $56 in U.S. trading.
* Intel rose 87 cents to $31.40, recouping some of its $1.19 loss Wednesday when Salomon Smith Barney lowered its earnings and sales estimates for the chip maker. The SOX semiconductor index rose 2.7%.
* Apple Computer fell 65 cents to $24.27 after J.P. Morgan cut its earnings view following the firm’s announcement that it will raise prices on new iMac models due to high component prices.
* Protein Design Labs jumped 22% after an analyst recommended the stock even though the company’s experimental drug to treat psoriasis, a skin disorder, proved ineffective. It rose $3.28 to $18.30.
* For the second day, oil prices rose to a six-month high. Crude for May delivery rose 66 cents to $25.61 a barrel in New York.
* AOL Time Warner slipped 55 cents to $24.65 after investment firm Lehman Bros. cut its first-quarter revenue and cash flow estimates for the media giant, citing concerns about advertising sales at its America Online division.
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Market Roundup, C5-6
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