Blue chips soar as investors bank on Fed to cut rates

Herald staff

NEW YORK — Optimism that interest rates might soon be lowered sent blue chip stocks soaring Monday, while earnings worries again dogged the tech sector.

Financial stocks surged on speculation that the Federal Reserve would cut rates more quickly than expected.

But tech stocks fell, unable to overcome Wall Street’s doubts about their profitability in a slowing economy.

T-bill rates fall: The Treasury Department sold three-month bills Monday at a discount rate of 5.77 percent, down from 5.9 percent last week. Six-month bills sold at a rate of 5.66 percent, down from 5.79 percent. The new discount rates understate the actual return to investors — 5.939 percent for three-month bills with a $10,000 bill selling for $9,854.10 and 5.907 percent for a six-month bill selling for $9,713.90. The Federal Reserve said Monday that the average yield for one-year Treasury bills, the most popular index for making changes in adjustable rate mortgages, fell to 5.73 percent last week from 5.78 percent.

Bothell firm inks alliance: SonoSite Inc. has reached an agreement with Novation for use of its SonoSite 180 hand-carried ultrasound system. Novation is the largest supply cost management company in health care, managing more than $15 billion in annual purchases for more than 7,000 health care organizations nationwide. Company officials say the deal is a sign of growing acceptance of its new technology for portable ultrasound equipment.

Monday prices: Gold sold for $270.20 a troy ounce, silver sold for $4.63 for the same amount and platinum sold for $604.