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U.S. stocks strut higher
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June 15, 2000: 5:29 p.m. ET
Microsoft, Intel lead gains on Dow, Nasdaq; Qualcomm, Wachovia fall
By Staff Writer Catherine Tymkiw
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NEW YORK (CNNfn) - Tech buyers won the tug-of-war with financial sellers, sending U.S. stocks higher Thursday, after gains in Microsoft and Intel countered losses in Qualcomm and Wachovia.
Analysts cited no new catalyst for the money shift except to say that apprehensive investors were just pushing their money around ahead of the next Federal Reserve meeting at the end of June.
"The psychology is just not there for the economy to make any substantial move until we get through the Fed meeting," said Barry Hyman, chief market strategist at Ehrenkrantz King Nussbaum, referring to the policy meeting on June 27-28. "There's really no selling pressure, it's just tremendous volatility."
 The Nasdaq composite index rose 48.32 points, or more than 1 percent, to 3,845.73. The Dow Jones industrial average gained 26.87 to 10,714.82. The S&P 500 advanced 8.06 to 1,478.60.
Hugh Johnson, chief investment strategist at First Albany, called the market trend-less and volatile
"It's an on again, off again market," Johnson told CNN's Street Sweep. "We have good days, we have bad days and we have rotations within sectors."
 Weakness in Qualcomm limited the tech gains. And financial stocks tumbled after Wachovia, a big regional bank, said higher interest rates would hurt profitability.
"It's just money circulating among the same groups," said Larry Rice, chief market strategist at Josephthal & Co. He also said some of the volatility was related to Friday's options expiration.
Analysts said some churning was coming in ahead of Friday's "triple witching" options expiration, analysts said. Triple witching occurs when the futures market, cash market and options all expire on the same day. Analysts said this could lead to large buy and sell orders, as well as unwinding positions to shift cash allocations.
Still, more stocks fell than rose on lackluster volume. Declining issues topped advancing ones on the New York Stock Exchange 1,463 to 1,419, on volume of more than 991 million shares. Nasdaq losers beat winners 2,156 to 1,814, as more than 1.3 billion shares changed hands.
In other markets, the dollar advanced modestly against the euro but was little changed versus the yen. Treasury securities edged lower.
Tech buyers outpace financial sellers
Microsoft (MSFT: Research, Estimates) rose 1-7/8 to 72-3/8 and Intel (INTC: Research, Estimates) jumped 1-13/16 to 128-1/4 as investors returned to the large capitalization tech stocks that got punished Wednesday.
But, Qualcomm (QCOM: Research, Estimates) fell 9-1/16 to 61-7/16 after Chase H&Q analyst Edward Snyder lowered his fiscal 2000 and 2001 profit forecasts on the company.
Alan Ackerman, senior vice president at Fahnestock & Co. said the markets -- once focused on fears of tighter credit -- have shifted their focus to earnings.
"The sands have shifted," said Ackerman. "Wachovia's weakness took the strength out of the financials and Qualcomm has taken quite a hit."
 Qualcomm, one of 1999's best-performing stocks, has been battered in recent weeks as investors handicap the odds of its wireless communications products entering the Chinese markets. In his research note, Snyder said there is "no positive news in sight" for the company.
Another company facing problems, Wachovia Corp. (WB: Research, Estimates), tumbled 13-1/8 to 57-1/16 after saying its second-quarter and full-year profit would fall short of Wall Street forecasts. The North Carolina-based regional bank blamed rising interest rates, which are at their highest point in nearly 10 years.
Bob McCooey, NYSE floor trader for Griswold Co., told CNNfn's Market Call that the Wachovia warning may be the start of other disappointing announcements. (357K WAV) (357K AIFF).
Other financial issues also fell. J.P. Morgan (JPM: Research, Estimates) dropped 4-7/8 to 126-1/2, Citigroup (C: Research, Estimates) lost 2-1/4 to 64-7/8, and American Express (AXP: Research, Estimates) shed 1-1/4 to 55-1/2.
Among the Dow's winners, Coca-Cola (KO: Research, Estimates) gained 2-11/16 to 55-11/16. Salomon Smith Barney upgraded the world's biggest beverage maker to "buy" from "outperform."
And Dow component Hewlett-Packard (HWP: Research, Estimates) surged 3 to 117, reversing a two-day sell-off that started with a downgrade by analysts at Sanford J. Bernstein.
Investors keep watch on economic data
For the first time in recent weeks, the day's economic indicators showed strength. The government said jobless claims fell last week, suggesting the labor market remains tight. Separately, production at the nation's factories and mines rose in May, countering Wall Street's expectations for a decline.
Still, analysts expect the Federal Reserve to hold rates steady at their policy makers' meeting in two weeks. A series of economic reports this month -- from retail sales to producer prices -- showed a slowdown, suggesting the central bank's six rate hikes in a year are taking effect.
But investors were not fully confident that the rate hikes are nearing an end after another Fed policy maker made a neutral speech.
Federal Reserve Bank of Richmond President Alfred Broaddus said interest rates should still rise despite signs that the pace of economic growth was starting to slow.
"In order to prevent a re-emergence of inflationary pressures and, in doing so, to sustain the expansion, U.S. monetary policy must allow short-term real interest rates to rise," Broaddus told the Austrian National Bank's annual economics conference Thursday.
Ehrenkrantz's Hyman said the comments indicated that it was too early to assume interest rate hikes have reached their end. "I think that puts a little bit of pressure on the market," he said. 
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