Tech stocks gain for second day
By Mike Tarsala, CBS.MarketWatch.com
Last Update: 4:20 PM ET Jan. 3, 2002
NEW YORK (CBS.MW) -- The Nasdaq reclaimed the 2,000 mark Thursday as chip, hardware and networking stocks pushed gains for a second straight session.
The tech market largely ignored worsening jobless figures by the Labor Department released Thursday. The number of Americans who continue to receive jobless benefits each week rose by 42,000 to 3.72 million, the loftiest level in six weeks. First-time application for unemployment benefits rose in back-to-back weeks for the first time since the middle of October.
The Nasdaq Composite ($COMPQ: news, chart, profile) gained 64.98 points, or 3.3 percent, to 2,044.23. Shares of Intel, Cisco and Oracle rose as three of the most actively traded stocks, helping the Nasdaq 100 Index ($NDX: news, chart, profile) gain 3.5 percent.
Chip stocks benefited from analyst upgrades following gains made in the previous session, driven by monthly industry data suggesting a sequential chip sales increase in the fourth quarter.
J.P. Morgan H&Q analysts recommended purchases of Intel (INTC: news, chart, profile) shares ahead of the company's quarterly report slated for mid-January. Analysts said that computer manufacturers continue to cut personal computer inventory, which could benefit chip sales. Also, the analysts said Intel's server business will grow sequentially in the first quarter of 2002.
Intel shares led the way for chips, gaining $2.52, or 8 percent, to $35.52. Shares of rival Advanced Micro Devices (AMD: news, chart, profile) also influenced trading, advancing $2.98, or 18 percent, to $19.37. Shares of communications chip company PMC-Sierra (PMCS: news, chart, profile) rose $2.14, or 9 percent, to $25. The Philadelphia Semiconductor Index ($SOX: news, chart, profile) climbed 8.3 percent.
Computer makers including Hewlett-Packard (HWP: news, chart, profile) moved higher, as the stock remains above its 50-day moving average. Shares gained $1.31, or 6 percent, to $22.96. Compaq (CPQ: news, chart, profile) shares moved up 48 cents, or 5 percent, to $10.96.
Storage hardware manufacturer EMC (EMC: news, chart, profile) rose $1.79, or 12 percent, to $16.59, after Salomon Smith Barney upgraded shares to "buy" from "outperform," on expectations that the company is on the verge of new product releases and partnership announcements, including possible mergers and acquisitions. The move influenced others in the storage group, as Brocade Communications (BRCD: news, chart, profile) shares rose 10 percent, and Network Appliance (NTAP: news, chart, profile) surged 13 percent.
Networking-equipment stocks moved higher, as Cisco Systems (CSCO: news, chart, profile) shares gained $1.53, or 8 percent, to $20.76. Shares of Lucent Technologies (LU: news, chart, profile), Alcatel (ALA: news, chart, profile) and Nortel Networks (NT: news, chart, profile) also moved ahead, while Redback Networks (RBAK: news, chart, profile) shares climbed 42 cents, or 9 percent, to $5.13.
Software shares also rose, although the group lagged the rest of the tech sector for a second straight session. In addition to the rising Oracle (ORCL: news, chart, profile) shares, BEA Systems (BEAS: news, chart, profile), PeopleSoft (PSFT: news, chart, profile), Veritas Software (VRTS: news, chart, profile) and Adobe Systems (ADBE: news, chart, profile) all advanced.
WebMethods (WEBM: news, chart, profile) stood out, as shares of the integration software maker rose $2.65 or 17 percent, to $19.02. The company plans to make its software available to the Department of Defense. WebMethods also will integrate its products with EMALL, the Pentagon's internal marketplace and procurement system. Financial terms of the deal were not disclosed.
Peregrine Systems (PRGN: news, chart, profile), meanwhile, was among the largest software decliners, as shares sank to early 1999 levels, down $5.24, or 36 percent, to $9.27. The maker of help desk, inventory tracking and other business software expects to report a fiscal third-quarter loss of 7 to 8 cents a share, excluding acquisition costs. Analysts surveyed by Thomson Financial/First Call had been forecasting a profit of 10 cents a share, on average.
The company's sales are expected to be $175 million, compared with analyst expectations of $219.5 million. Peregrine blamed "challenging global economic conditions," particularly in Europe, for the perceived shortfall.
________________________________________
Mike Tarsala is a San Francisco-based reporter for CBS.MarketWatch.com. |
