WSJ:
Share Prices Rise
As Internet Stocks
Pace the Advance
By TERRI CULLEN
INTERACTIVE JOURNAL
Share prices rose to record
levels Monday, paced by a
powerful Internet stock rally. The
yield on the bellwether 30-year
Treasury fell to a new low and the
dollar lost ground against the mark
and yen.
The Dow Jones Industrial
Average rose 66.51 to close at
9091.77. Monday's gain put the
blue-chip barometer within 120
points of its all-time high of
9211.84 set on May 13. The
tech-laden Nasdaq Composite
Index climbed 15.43 to 1909.43,
within striking distance of its April
22 record of 1917.61.
Broad market indicators
eclipsed their previous records,
however, with Standard & Poor's
500-stock index up 10.90 to a
new high of 1157.32 and the New
York Stock Exchange Composite
Index up 5.02 to a record 590.82.
A torrent of corporate news
sent Internet stocks rocketing
higher Monday. Lycos led the
charge after the search engine
company announced a 2-for-1
stock split. Its shares jumped 20
1/2 to 99 9/16. Shares of Audio
Book Club, which have soared in
the last three sessions after the
company said it is gaining 4,500
new members a month via the
Internet, advanced 9 3/4 to 19 3/8.
And Zapata rocketed 11 5/8 to
21 1/2 after the company said it
will split its Internet operations
from its fish protein and
sausage-casings businesses,
creating two publicly traded
companies. Elsewhere in the
sector, Yahoo! jumped 26 3/8 to
close at 199 1/4, after hitting an
intraday high of 200. Excite
climbed 8 1/16 to 107, and
Amazon.com advanced 15 1/2 to
139 1/2.
But worries about Asia
contained the market's advance
after comments made by Japanese
Prime Minister Ryutaro Hashimoto
over the weekend appeared to
back away from making proposed
income-tax cuts permanent, and
instead said he had vowed only to
review permanent reform of the tax
system.
Confusion over the direction of
Japanese policy sent stocks
spiraling lower across Asia
Monday. Fears that Asia's
persistent weakness will have a
greater-than-expected impact on
U.S. multinationals also were
weighing on Wall Street.
Erik Gustafson, portfolio
manager in Chicago for Stein Roe
& Farnham, said concern about
Japan's unwillingness to support
concrete measures to aid its
flagging economy "continues to
dominate all of our thoughts,
especially as we await
second-quarter earnings."
Investors who are betting that
Asia's financial troubles have been
discounted by the market may be
in for a rude awakening, he added.
"In the next two weeks we're going
to get to see first hand what impact
Asia is having on earnings and right
now we're worried," he said. "We
think the impact is going to be
much deeper than people are
expecting."
The renewed uncertainty in
Asia also spurred some
flight-to-quality buying in the U.S.
Treasurys market. The long bond's
yield, which moves in the opposite
direction of its price, dropped to
5.568%, its lowest yield since the
1960s.
World-wide, stocks rose in
dollar terms. The Dow Jones
World Stock Index was up 0.89 to
196.13 as of 4 p.m. EDT.
In major market action:
Stocks climbed. Volume
reached 516.8 million shares on
the New York Stock Exchange,
where 1,721 stocks advanced and
1,263 declined.
Bonds climbed. The Treasury's
benchmark long bond rose more
than 3/8 point, or $3.75 for each
$1,000 face amount. Its yield,
which moves in the opposite
direction of its price, eased to
5.568%.
The dollar slipped. It was at
140.21 yen and 1.8122 marks,
compared with 140.95 yen and
1.8200 marks late Thursday in
New York. |
