Nasdaq finally gains
cnnfn.cnn.com
NEW YORK (CNNfn) - The Nasdaq composite index inched higher Thursday for its first gain in almost two weeks in a turnaround unlikely to keep the index from posting its worst year on record.
Cisco Systems, Intel and Microsoft, all down more than 35 percent during the last six months, drew buyers. But WorldCom and Yahoo! resumed a technology slide that started in March, when the Nasdaq peaked at more than twice today's levels.
The day's action came as AT&T, Lucent Technologies and a handful of other tech firms said they would miss their quarterly financial targets. At the same time, the latest economic figures from the government showed further signs of a slowdown, giving the Federal Reserve more ammunition to cut interest rates next year.
"I think we are getting close to the bottom here," Jordan Kimmel, portfolio manager at Magnet Management, told CNNfn's Market Call.
The Dow Jones industrial average broke a two-day losing streak. And the Nasdaq held up decently, a sharp contrast to its big tumbles on Tuesday and Wednesday.
The Nasdaq rose 7.35 points to 2,340.13. The first gain in eight sessions comes one day after the Nasdaq fell to a 20-month low. The Dow climbed 168.36 points, or 1.6 percent, to 10,487.29 while the S&P 500 advanced 10.12 to 1,274.86.
Market breadth was mixed in heavy trading volume. Advancing issues on the New York Exchange edged out declining ones 1,684 to 1,232 as 1.4 billion shares traded. Nasdaq losers topped winners 2,241 to 1,799. More than 2.6 billion shares changed hands.
In other markets, Treasury securities were mixed. The dollar declined against the euro and yen.
Big techs draw some interest
In a brutal month on Wall Street, the Nasdaq fell in seven straight sessions prior to Thursday. The index, down 42.5 percent year-to-date, looks set to surpass its 35.1 percent slide in 1974, the worst performance in the Nasdaq's 31-year history.
But some of the hardest-hit tech stocks advanced Thursday. Cisco Systems (CSCO: Research, Estimates) rose $2.38 to $38.88, Intel (INTC: Research, Estimates) gained $1.19 to $33.13 and Microsoft (MSFT: Research, Estimates) climbed $1.94 to $43.44.
But Yahoo! (YHOO: Research, Estimates) tumbled $2.31 to $25.63, while WorldCom (WCOM: Research, Estimates) shed $1 to $14.19
Lifting the Dow, J.P. Morgan rose $8.25 to $167.38, while Wal-Mart (WMT: Research, Estimates) gained $2.81 to $51.75.
The slight gains come in contrast to the period since Labor Day, when stocks fell amid signs of a slowing economy.
More evidence of the economy's cooling emerged Thursday when the government reported the nation's gross domestic product grew at a 2.2 percent annual rate last summer. That, the weakest growth in four years is less than half the second quarter's 5.6 percent GDP jump.
Separately, the number of Americans filing new claims for unemployment benefits rose by 34,000, to 354,000 last week. Already, companies including Chase Manhattan Bank, Gillette and Whirlpool have announced job cuts in recent weeks as the tight labor market appears to be loosening.
"I think we are slowing down much faster than anyone anticipated," Doug Cliggott, U.S. equity strategist at J.P. Morgan, told CNNfn's In the Money.
Profits, meanwhile, are falling. Lucent Technologies (LU: Research, Estimates) once again warned that financial results would be lower than expected. The telecommunications company said it expects a first-quarter loss of 25-to-30 cents a share, much worse than Wall Street's forecasts for a loss of 1 cent a share. Lucent stock fell $1.31 to $14.19.
AT&T (T: Research, Estimates) lost $1.88 to $17.06, nearly an eight-year low, after slashing its dividend by 83 percent Wednesday and warning that fourth-quarter earnings and revenue will miss estimates due to weakness in the long-distance sector.
A series of other companies trotted out earnings warnings Wednesday and Thursday. They include Realnetworks, Sandisk and Conexant Systems. As firms close their books on 2000, few analysts expect these disappointments are over.
The Federal Reserve may be the market's best hope for a sustained turnaround. The central bank left interest rates unchanged Tuesday. But the Fed signaled its readiness to lower borrowing costs next year for the first time since 1998.
"I think what the market is really saying is it needs a catalyst," Barry Hyman, chief investment strategist at Weatherly Securities, told CNN's Street Sweep |
