Blue chips surge but technology issues fall again

Associated Press

NEW YORK — Blue chip stocks surged today, offsetting some of the damage in the technology sector as investors again sold off shares or turned away from companies viewed as too risky.

But the market’s enthusiasm for aluminum, farming equipment and financial services wasn’t enough to lift the tech sector out of its malaise. Earnings reports dogged stocks even as the end of the third-quarter earnings season approached.

The Dow Jones industrial average closed up 245.15 at 10,835.77, according to preliminary calculations, the second straight session that the blue chips have gained more than 200 points.

The tech-focused Nasdaq composite index struggled, falling 87.03 to 3,191.33, after being off nearly 130 points earlier in the day. The Standard &amp Poor’s 500 index rose 19.07 to 1,395.65.

In a continuation of what has been the pattern all month, concern about the long-term profitability of technology stocks drove many investors Monday to unload those shares in favor of blue chips.

The Nasdaq fell last week while the Dow rose more than 360 points.

"I think people are fed up with technology and they shouldn’t be. It’s the only growth sector out there," said Barry Hyman, chief investment strategist at Weatherly Securities. "People instead have sought the safety of the Dow, looking at financials and consumer staples to play the market."

Technology stocks fell across the board. Qualcomm tumbled $6.75 to $68.13 after one its primary customers, Globalstar Communications, missed Wall Street estimates for third-quarter earnings. Globalstar plunged $3.63, or 60 percent to $2.38.

Cisco Systems fell $2.63 to $48.06 after Lehman Brothers cut the stock’s 12-month price target between $60 and $65 instead of $90.

The Dow’s advance grew out of widespread gains. Investors appeared to be putting their money in old-economy stocks, ranging from American Express, up $2.63 to $58.44, to agriculture equipment manufacturer Caterpillar, which rose $2.06 to $34.94. Aluminum producer Alcoa jumped 13 percent, up $3.25 to $28.25.

The shift into blue chips reflected investors’ anxiety about the economy, and subsuqent move into stocks that are viewed as sure bets for growth, albeit slower growth.

"Whenever the market starts worrying about a slowdown in the economy, it goes after companies that will continue to grow their earnings no matter what: drugs, beverages, food, these are all defensive issues," said Gary Kaltbaum, a technical analyst at JW Genesis. "The market is as defensive as I’ve seen in years."

The U.S. economy has been showing signs of moderating growth but the Commerce Department said Monday personal incomes rose a strong 1.1 percent in September — the fastest pace in more than a year.

Spending, propelled by heavy demand for durable goods such as autos, was up 0.8 percent, the largest amount since February.

Advancing issues outnumbered decliners by nearly a 2-to-1 ratio on the New York Stock Exchange, where volume came to 1.16 billion shares compared with 1.08 billion on Friday.

The Russell 2000 index rose 2.88 at 482.73

Overseas, Japan’s Nikkei stock average fell 0.81 percent. Germany’s DAX index rose 0.30 percent, Britain’s FT-SE 100 climbed 0.34 percent, and France’s CAC-40 was up 0.45 percent.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Local News

Customers enter and exit the Costco on Dec. 2, 2022, in Lake Stevens. (Olivia Vanni / The Herald)
Costco stores could be impacted by looming truck driver strike threat

Truck drivers who deliver groceries and produce to Costco warehouses… Continue reading

Two Washington State ferries pass along the route between Mukilteo and Clinton as scuba divers swim near the shore Sunday, Oct. 22, 2023, in Mukilteo, Washington. (Ryan Berry / The Herald)
Ferry system increases ridership by a half million in 2024

Edmonds-Kingston route remains second-busiest route in the system.

Alina Langbehn, 6, center, and Vera A., 6, right, sit on a swing together at Drew Nielsen Neighborhood Park after school on Tuesday, Jan. 28, 2025 in Everett, Washington. (Olivia Vanni / The Herald)
Everett council votes to renovate Drew Nielsen Park

Construction on the $345,000 upgrade could start as early as this fall.

Northshore School District bus driver Stewart O’Leary pictured next to his buses shattered drivers side windshield on Friday, Feb. 14, 2025 in Bothell, Washington. (Olivia Vanni / The Herald)
‘Put me in, coach’: Bus driver back at work after struck by metal bar

Stewart O’Leary, a Northshore employee, has received national attention for his composure during a frightening bus trip.

Lynnwood councilor Joshua Binda speaks during a Lynnwood City Council meeting on Wednesday, Nov. 20, 2024. (Olivia Vanni / The Herald)
Does the Lynnwood Council VP live in Lynnwood? It’s hard to say.

Josh Binda’s residency has been called into question following an eviction and FEC filings listing an Everett address. He insists he lives in Lynnwood.

Robin Cain with 50 of her marathon medals hanging on a display board she made with her father on Thursday, Jan. 2, 2025 in Lake Stevens, Washington. (Olivia Vanni / The Herald)
Running a marathon is hard. She ran one in every state.

Robin Cain, of Lake Stevens, is one of only a few thousand people to ever achieve the feat.

People line up to grab food at the Everett Recovery Cafe on Wednesday, Dec. 4, 2024 in Everett, Washington. (Olivia Vanni / The Herald)
Coffee, meals and compassion are free at the Everett Recovery Cafe

The free, membership-based day center offers free coffee and meals and more importantly, camaraderie and recovery support.

The Everett Wastewater Treatment Plant along the Snohomish River on Thursday, June 16, 2022 in Everett, Washington. (Olivia Vanni / The Herald)
Everett water, sewer rates could jump 43% by 2028

The rate hikes would pay for improvements to the city’s sewer infrastructure.

The bond funded new track and field at Northshore Middle School on Thursday, Oct. 24, 2024 in Bothell, Washington. (Courtesy of Northshore School District)
Northshore School District bond improvements underway

The $425 million bond is funding new track and field complexes, playgrounds and phase one of two school replacements.

An American Robin picks a berry from a holly tree on Thursday, Feb. 13, 2025 in Edmonds, Washington. (Olivia Vanni / The Herald)
Calling all birders for the annual Great Backyard Bird Count

The Audubon Society will hold its 28th annual Great Backyard… Continue reading

A view of one of the potential locations of the new Aquasox stadium on Monday, Feb. 26, 2024 in Everett, Washington. The site sits between Hewitt Avenue, Broadway, Pacific Avenue and the railroad. (Olivia Vanni / The Herald)
Initial prep work for AquaSox stadium to start, with $200k price tag

The temporary agreement allows some surveying and design work as the city negotiates contracts with designers and builders.

Aaron Kennedy / The Herald
The Joann Fabric and Crafts store at 7601 Evergreen Way, Everett, is one of three stores in Snohomish County that will close as part of the retailer’s larger plan to shutter more than half of its stores nationwide.
Joann store closure plan includes Everett, Arlington, Lynnwood locations

The retail giant filed a motion in court to close approximately 500 stores in the U.S.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.