Tech’s Rise Counters Dow’s Dip
A cautious stock market finished the session mixed Monday as a management shake-up at Boeing pressured blue chips while technology shares saw strong buying. The Dow Jones industrial average came within 16 points of cracking 11,000 but settled with a small loss.
Profit taking pushed the Dow lower as Boeing, one of the 30 companies in the index, said Chief Executive Harry C. Stonecipher was asked to resign because of a relationship with a female executive.
The Dow’s dip was countered by a jump in tech stocks, which had been lagging in the market’s recent rally. Analysts said Friday’s strong February employment report from the Labor Department probably encouraged many investors to reenter the market for technology shares.
An upbeat outlook from Qualcomm also helped stoke the tech-dominated Nasdaq market’s advance.
“If you’re going to go higher, you have to have techs involved, and we’re seeing that,” said Todd Leone, managing director of equity trading at SG Cowen Securities. “Overall, the market seems pretty resilient. It looks like it wants to go to 11,000.”
The Dow slipped 3.69 points, or 0.03%, to 10,936.86, failing to top the 3 1/2 -year high reached Friday, when it rose 107 points. The Dow reached 10,984 in intraday trading before moving lower in the final hour of trading.
But most broader stock indicators were modestly higher. The Standard & Poor’s 500 index added 3.19 points, or 0.3%, at 1,225.31, adding to its multi-year high reached Friday.
The Nasdaq composite index gained 19.60 points, or 1%, to 2,090.21, though it remains well below its recent multi-year closing high of 2,178.34 reached on Dec. 30.
Winners topped losers by a slim margin on the New York Stock Exchange, while winners and losers were nearly even on Nasdaq.
A late rise in crude oil futures put downward pressure on the market, analysts said. In New York trading, a barrel of light crude rose 11 cents to $53.89, a fresh four-month high.
Bond and currency markets were little changed. The yield on the benchmark 10-year U.S. Treasury note was flat at 4.31% amid a dearth of economic news.
In other market highlights:
* Qualcomm climbed $1.89 to $37.39. The world’s No. 2 maker of chips that run mobile phones said net income this quarter would be as much as 27 cents a share, compared with a previous top forecast of 26 cents.
The news helped to lift other chip stocks, including Vitesse Semiconductor, up 19 cents to $3.19; Broadcom, up 80 cents to $32.11; and QLogic, up $1.55 to $42.68. Intel, which will meet with investors Thursday, added 43 cents to $25.11, an eight-month high.
An S&P; 500 index of semiconductor stocks rose 1.8% for the biggest increase among the benchmark’s 24 industry groups. The chip sector, which was the worst-performing S&P; industry in 2004, has rebounded 4.9% this year on indications that fewer chips are piling up at equipment manufacturers as demand increases.
But after regular trading ended Texas Instruments said first-quarter profit would be 22 to 24 cents a share, compared with a January forecast of 22 cents to 26 cents. The stock, which rose 48 cents to $27.37 in regular trading, fell to $26.50 in after-hours activity.
* In the defense sector, Boeing eased 8 cents to $58.30 after the ouster of Stonecipher. Meanwhile, United Defense Industries surged $15.09 to $73.35 after BAE Systems, Europe’s largest defense contractor, agreed to buy the company for $75 a share, or nearly $4 billion.
* Sony was up 77 cents at $39.31 after the Japanese conglomerate named former CBS president Howard Stringer as chairman and CEO.
* Strength in railroad and trucking shares helped lift the Dow transports index 45.16 points, or 1.2%, to a record high of 3,876.13. Union Pacific rallied $1.72 to $66.03 and JB Hunt gained $1.55 to $48.54.
* Energy stocks were mostly lower. Exxon Mobil lost 57 cents to $63 and Valero fell $1.06 to $72.80. But Unocal -- the subject of recent takeover rumors -- rose $1.35 to a record $62.10.
* Google advanced $2.91 to $188.81. The Internet search giant hired a top Microsoft engineer who was one of the six original members of the team that created the Windows NT operating system. Microsoft added 30 cents to $25.47.
