Associated Press
NEW YORK – Blue chip stocks surged today, but technology issues fell back after an earnings warning from National Semiconductor revived worries about high-tech profits.
The latest batch of earnings reports received a mixed reception from investors, and spurred no major buying or selling. Investors remained focused on Amazon.com, Nortel and Compaq, which were due to report their results after the market closed.
The Dow Jones industrial average closed up 121.35 at 10,393.07, according to preliminary calculations.
Broader stock indicators were mixed. The tech-focused Nasdaq composite index was off 48.87 at 3,419.82. The Standard &Poor’s 500 index was up 2.35 at 1,398.13.
The third-quarter earnings season doesn’t wrap up for another week, but analysts don’t expect upcoming numbers to move the market the way IBM’s disappointing results did last week, sending the Dow down more than 400 points during Wednesday’s trading.
“The market is basically through with its dirty work,” said Charles Pradilla, chief investment strategist at SG Cowen Securities.
That doesn’t mean it will be easy going for tech stocks. Although the market has largely advanced in the last four sessions, pricey tech issues have been less stable. Investors aren’t likely to see a quick comeback.
Tech companies “were down sharply, 40 percent off their highs. It is going to take a long healing process before any gains are sustainable,” said Steven Goldman, market strategist for Weeden &Co.
The sector, which ended the previous session slightly down, weakened again after an earnings warning late Monday from chip maker National Semiconductor, which tumbled $11.56, or about 32 percent, to $24.44.
Chip makers Intel and Advanced Micro Devices also fell, trading down $1.13 to $42.19, and off $1.81 at $20.13, respectively.
Microsoft, a Dow component, slipped 63 cents to $61.50.
The Dow moved higher on banker J.P. Morgan, which rose $7.44 to $145.94. Its merger partner Chase Manhattan was up $1.56 at $40.
Earnings continued to affect individual stocks. Toothpaste maker Colgate-Palmolive rose $3.91 to $53.12 after it reported earnings slightly ahead of analyst expectations.
Oil companies ExxonMobil, Texaco and Chevron all beat Wall Street estimates, but their stocks slipped on concerns about how long they will benefit from higher energy prices.
Advancing issues outnumbered decliners by a ratio of 12 to 11 on the New York Stock Exchange, where volume came to 1.15 billion shares, compared with 1.02 billion in the previous session.
The Russell 2000 index fell 2.10 to 487.86.
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