Wall Street Technology shares close near highs led by chips as buyers return
SAN FRANCISCO (AFX) - Prices of technology closed near their highs for the day, with semiconductor issues again leading the advancers as investors began to move money back into the equities market ahead of the quarter-end, dealers said. The Nasdaq composite rose 1.63 pct to close 30.98 points higher at 1,928.68. The index earlier reached an intraday high of 1,952.92 after briefly slipping as low as 1,891.99 and opening at 1,938.91. Volume came in at 2.28 bln shares, with 2,475 issues advancing, 1,230 declining and 611 remaining unchanged. The Nasdaq 100 edged a more modest 3.12, or 0.18 pct higher, to 1,705.02 and the Philadelphia semiconductor index (Sox) was up 2.5 pct, or 15.70 points, at 642.09. Elsewhere, the DJIA recovered some of its recent slide to close 115.30 higher at 9,504.78 and the S&P 500 moved 22.25 up to close at 1,139.83. First Union Securities head of equity trading Mike Murphy told AFX News the market saw gains across the board, with overall sentiment boosted by the rise in chip stocks in particular. "Chips have been oversold and this rally is overdue," he said. Adding momentum to the rise, Murphy agreed, was the fact that investors need to adjust their portfolios ahead of the quarter-end. "Investors are nearing the end of the quarter and looking at the tech sector as a way of putting their money to work," he said. Looking ahead, Murphy said Monday will be crucial in determining whether or not sentiment really is improving. "I am sure there is still some bad news (on earnings) to come, but if today's move is repeated on Monday, it will be a very good sign for this market's medium-term prospects." AMD led chip issues higher, steaming over 11 pct ahead to close up 2.99 usd at 29.44. Intel gained 1/8 to 28-13/16, Texas Instruments moved 0.94 usd higher to 38.81 and National Semiconductor added 1.35 usdto 29.65. Motorola closed 0.31 usd higher at 15.99 after the company announced another redundancy round hitting 4,000 jobs in three of its sectors. Today's announced cuts bring the total number of jobs eliminated at Motorola to 22,000. Analysts were positive on the latest cost-cutting measure, with Deutsche Banc Alex. Brown saying the cuts are another step "to improve the structure of its business to improve long-term profitability". Micron climbed 2.13 usd or over 4.5 pct to 48.83. The company's Micron Electronics unit reported its results before market open and Micron is now expected to post its consolidated results early next week. Amongst chip equipment makers, Applied Materials 13/16 higher at 50-1/4, while KLA-Tencor gave up 11/16 to 44-15/16. Yesterday, SEMI said the book-to-bill ratio for February slipped to 0.77 from a revised 0.80 in January. Analysts agreed shares in the segment will likely remain volatile in the near term, with the industry to see orders decline until a bottom sometime around the summer. Cisco was a weak spot amongst technology shares, as it came under pressure from cuts to its estimates by analysts on a weak outlook. Speculation circulated on the market that the company may be forced to issue a profit warning served to further depress the shares. Cisco closed down 1 usd or 5.06 pct at 18-3/4. In contrast, Oracle gained 2.42 pct to close up 3/8 at 15-7/8 and Microsoft rose 2-9/16 to 56-9/16. Lucent recouped its losses from yesterday to close 0.53 usd higher at 11.62. Lucent will likely scrap plans to float its Agere unit and may instead hold out for a buyer to purchase the business outright, analysts said. HP gained 0.28 usd to 31.17, Dell climbed 1-3/16 to 27-7/16 and Compaq gained 1.10 usd to 20.50. Apple was up 1-3/8 at 23 and Gateway rose 0.81 usd to 17.67. 3Com lost 1/32 to 5-7/8. The company said it will sack 170 staff at its consumer broadband operations under its earlier announced cost-cutting programme. The job cuts will generate cost savings yearly of 18 mln usd, while the company will take a 4-mln usd related charge.
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