U.S. stocks rise; appetite for techs offsets Intel
March 03, 2006 13:34:27 (ET)
(Updates to early afternoon)
By Caroline Valetkevitch
NEW YORK, March 3 (Reuters) - U.S stocks rose on Friday, reflecting a turnaround at midday, as investors bought technology shares on optimism about the sector's growth outlook in spite of chip maker Intel Corp.'s revenue warning.
Worldwide sales of semiconductors rose 7 percent in January to $19.66 billion from the same month in 2005, the Semiconductor Industry Association said on Thursday.
"Institutional sentiment still wants to be long the market. It wants to be long semiconductor stocks, regardless of what Intel had to say," said Michael James, senior trader at regional investment bank Wedbush Morgan in Los Angeles.
"If you look at almost anything else semiconductor away from Intel, they're doing better today. People are viewing the semiconductor space as being strong in general and Intel is not the bellwether it was in the past," James said.
By midday, semiconductor stocks like memory chip maker Micron Technology Inc. (MU,Trade) and Texas Instruments Inc., the world's top supplier of chips for mobile phones, (TXN,Trade) were higher. Micron Technology's stock was up 2.1 percent at $16.18 and Texas Instrument's stock was up 1.7 percent at $32.89, both on the New York Stock Exchange.
The Dow Jones industrial average ((.DJI)) was up 65 points, or 0.58 percent, at 11,090.03. The Standard & Poor's 500 Index ((.SPX)) was up 6.12 points, or 0.47 percent, at 1,295.26. The Nasdaq Composite Index ((.IXIC)) was up 9.82 points, or 0.42 percent, at 2,320.93.
The Nasdaq got a boost from shares like Google Inc. ((GOOG.O)), up 1.6 percent at $382.60, a day after its CEO told analysts it planned to become a $100 billion company.
For most of the session until just before 12:30 p.m. (1730 GMT), the Dow industrials, the S&P 500 and the Nasdaq Composite were lower. Those declines partly reflected a drop in Intel (INTC,Trade) shares after the dominant chip maker's warning before the opening bell that first-quarter revenue would miss its previous expectation.
A jump in the 10-year U.S. Treasury note yield to near one-year highs also dampened the mood on Wall Street.
Intel, the world's largest semiconductor maker warned before the opening bell that first-quarter revenue would miss its previous expectation because of weaker-than-expected demand and a slight loss of market share.
Intel shares were down 1.2 percent at $20.25 on Nasdaq, after hitting a low of $19.86 earlier in the day.
Shares of Boeing Co. (BA,Trade) climbed 1.8 percent to $74.16 on the NYSE after Australia's government said on Friday it plans to buy A$2 billion ($1.5 billion) of Boeing planes.
Rising oil prices lifted shares of energy companies like Exxon Mobil Corp. (XOM,Trade), which buoyed both the Dow industrials and the S&P 500. Exxon Mobil was up almost 1 percent at $61.40 on the NYSE. U.S. crude for April delivery was up 9 cents at $63.45 a barrel, after earlier rising as high as $63.75.
The Nasdaq 100 also got a lift from shares of Starbucks Corp. (SBUX,Trade), up almost 2 percent at $36.10, a day after the coffee chain reported an 8 percent rise in February sales. |
