Tech Stocks Lead Wall Street Gains
Technology stocks lifted Wall Street on Thursday as upbeat forecasts on computer chip stocks helped propel the tech-heavy Nasdaq to its longest streak of gains in more than 3 1/2 years.
The Nasdaq composite index has risen in seven straight sessions for the first time since Feb. 8, 2000. The broader Standard & Poor’s 500 index has notched gains eight sessions in a row for the first time since March 21.
In addition, Nasdaq hit a fresh 17-month closing high, while the blue-chip Dow Jones industrial average and the S&P; 500 edged above the 14-month highs hit the day before.
The Dow rose 19.44 points, or 0.2%, to 9,587.90, while the S&P; 500 notched a gain of 1.7 points, or 0.2%, to 1,027.97, and Nasdaq added 16.07 points, or 0.9%, to 1,868.97.
All three indexes are up strongly since their low points of the year on March 11. The Dow has rallied about 27%, the S&P; 500 is up 28%, and Nasdaq has gained a heady 47%.
On Thursday, advancers outnumbered decliners by about 9 to 7 on the New York Stock Exchange and Nasdaq in active trading.
Early in the session, the government said initial claims for unemployment benefits rose unexpectedly last week. But productivity of U.S. businesses, orders for American goods and growth in the service sector all came in ahead of economists’ forecasts.
Goldman Sachs raised its rating on tech bellwether Cisco Systems, continuing Wall Street’s recent bullish mood on technology stocks. Cisco shares rose 35 cents to $20.59. UBS put a “buy” recommendation on semiconductor stock Applied Materials and others, citing growing momentum for orders of equipment for building microchips. Applied Materials gained 26 cents to $21.22.
“You’re seeing mainly gains in the technology sector and more specifically in the semiconductor and hardware space,” said Keith Keenan, vice president of institutional trading at Wall Street Access.
During the two previous sessions, “the semiconductors were weak while the broader market was strong, so I think the upgrade from UBS was well timed in terms of buying some of the short-term weakness,” he said.
In other trading, Treasury yields slipped as Federal Reserve officials in several separate speeches predicted inflation would not pose a threat to the economy anytime soon, suggesting interest rates could stay low for a while. The yield on the benchmark 10-year Treasury note fell to 4.51% from Wednesday’s close of 4.59%.
The dollar rose against the yen but lost ground against the euro. After the market closed, CNBC reported that President Bush said in an interview with the network that China’s currency policies were unfair and that Washington would “deal with it accordingly.”
Oil dipped 51 cents to $28.98 a barrel in New York trading, bringing its loss this week to more than 8%.
In other highlights:
* After the close of regular trading, Intel, the world’s largest maker of semiconductors, said it expected third-quarter revenue to come in even with or above analyst expectations. After rising 38 cents to $28.60 in the regular session, Intel rose almost 2% in after-hours trading.
* Bank of America fell for a second day, dropping $1.76 to $76.24. New York Atty. Gen. Eliot Spitzer said the company and other financial services firms let hedge funds buy mutual fund shares at prices unavailable to most investors. Also named by Spitzer were Janus Capital Group, which lost $1.28 to $15.60, and Bank One, which declined 59 cents to $39.38.
* Network Associates, a security software maker, was boosted by strong demand after several recent widespread attacks on computers. Brokerage Merrill Lynch upgraded its rating on the stock to “buy” from “sell.” It was up 99 cents to $15.50.
* McDonald’s rose after it said U.S. sales continued to show strength in August and sales in Europe improved slightly. It also said a federal judge in New York threw out a refiled lawsuit that sought to blame the fast-food chain for obesity and health problems in children. McDonald’s shares rose 70 cents to $23.39.
* Clothing retailer Gap dropped after it reported August sales growth that was short of expectations. Gap fell $2.82, or 13%, to $18.18.
Market Roundup, C6-7
