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Wall St. pushes higher
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November 26, 2001: 5:06 p.m. ET
Tech gains lift stocks despite mixed retail news, weak oil sector.
By Staff Writer Alexandra Twin
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NEW YORK (CNN/Money) - Wall St. pushed forward Monday with the Nasdaq composite riding a tech wave and the Dow Jones industrial average nearing 10,000 despite negative market commentators and mixed retail news.
Intel and Taiwan Semiconductor Manufacturing helped the chip sector, while a breakthrough in cloning made the biotech sector one of the day's winners. However, a murky retail picture and continued uncertainty about global oil prices restrained the market's advance.
The Dow Jones industrial average currently stands fewer than 20 points below 10,000, a level that some analysts say may not mean much in terms of signaling a recovery but that carries a psychological significance nonetheless.
"I think we're seeing a continuation of the bullish buys that have been going on for a while. The market is showing some resiliency," Bryan Piskorowski, market commentator, Prudential Financial, told CNNfn's Street Sweep. (473K AIFF) (473K WAV)
The Dow Jones industrial average rose 23.04 to 9,982.75. The Nasdaq composite rose 38.03 to 1,941.23, while the Standard & Poor's 500 added 7.08 to 1,157.42.
On Tuesday, the Conference Board releases its measure of consumer confidence for November. The survey's index is expected to show a rise to 86.5 from 85.5 in October.
Also on Tuesday, retailer Kmart (KM: Research, Estimates) releases its quarterly results. The company is expected to have lost 26 cents per share, showing an 85 percent decline from the 14 cents per share earned one year ago.
Asian stocks closed broadly higher, with Tokyo's Nikkei index finishing up 3.4 percent. European markets were mixed to lower.
Treasury prices fell, with the 10-year note yield rising to 5.02 percent from 4.97 percent late Friday. The dollar was slightly lower against the yen and the euro. In New York, light crude oil futures were down 27 cents to $18.69.
Market breadth was positive. On the New York Stock Exchange, advancers squeaked ahead of declining issues 8 to 7 as 1.08 billion shares traded. On the Nasdaq, winners beat losers 4 to 3 as 1.71 billion shares changed hands.
Chips give techs a boost
Giving a lift to the tech sector, No. 1 chipmaker Intel (INTC: up $0.81 to $31.87, Research, Estimates) said it has designed a new way to build transistors, the tiny switches that help chips work.
Credit Suisse First Boston issued a global note saying that a hardware-led recovery looks more probable in 2002, while A.G. Edwards upped its 2002 estimates on the S&P 500.
But keeping the broader market from a sharp advance were analysts offering some negative tech and stock allocation commentary. Douglas Cliggott, J.P. Morgan equity strategist, said investors should sell some stocks and buy some bonds, saying it's a good time to lighten equity exposure.
Lehman Bros. also said it is scaling back exposure to tech stocks, saying the recent rally has pushed tech valuations into the top half of their trading range.
Countering this, in the first confirmation of the dreaded "R" word, the National Bureau of Economic Research declared that the U.S. recession started in March. While hardly surprising, the report sent a negative psychological message nonetheless.
In addition, reports on consumer activity during the important post-Thanksgiving day holiday weekend were mixed, while Russia has continued to waffle regarding the level of its commitment to helping keep global oil prices high.
In the war against terrorism, Northern Alliance troops strengthened their hold in Konduz, Afghanistan. President Bush warned of a "dangerous period" in the war against terrorism, saying Americans should expect some U.S. deaths.
Techs on the rise
Chipmakers and computer hardware and software companies kept tech investors happy. Biotechs, telecoms and networking issues were mixed.
Semiconductors rose on the Intel development, as well as on news that Taiwan Semiconductor Manufacturing (TSM: up $0.90 to $16.60, Research, Estimates), the world's biggest contract chipmaker, has raised its sales and profit forecast for 2001, adding strength to the semiconductor sector.
IBM (IBM: up $0.98 to $116.33, Research, Estimates) said it will be launching a faster, smaller computer aimed at large businesses using the new Intel chips.
Biotechnology was active following the announcement Sunday by Advanced Cell Technology that it had successfully created human embryos through cloning. The news gave a lift to Geron (GERN: up $0.78 to $10.96, Research, Estimates) and StemCells (STEM: up $0.25 to $2.96, Research, Estimates).
However, telecommunications-related issues were mixed after Lucent Technologies (LU: down $0.35 to $8.04, Research, Estimates) suffered Morgan Stanley and ABN Amro downgrades.
Initial reports from the nation's retailers show investors taking advantage of some post-holiday sales, both online and with traditional retailers. Although sale prices are good news for consumers, they aren't necessarily good for corporations because they erode profit margins.
Internet retailers made some gains, including Yahoo! (YHOO: up $2.34 to $18.07, Research, Estimates), which rose after the company said its shopping division posted Thanksgiving weekend sales that rose 75 percent from the same period one year earlier.
Amazon.com (AMZN: up $3.13 to $12.21, Research, Estimates) said it was selling about 12,000 more items per hour than at the same time a year ago. eBay (EBAY: up $3.61 to $65.16, Research, Estimates) was also on the rise. The Goldman Sachs internet index finished up nearly 5 percent.
Oil prices still slippery
Falling global oil prices have hurt oil and energy-related stocks in recent weeks, as OPEC has struggled to convince non-OPEC members to join the fight to boost prices.
Dow component Exxon Mobil (XOM: down $0.67 to $37.77, Research, Estimates) was among the decliners.
Both energy traders Enron (ENE: down $0.70 to $4.01, Research, Estimates) and Dynegy (DYN: down $1.15 to $39.25, Research, Estimates) also were active on concerns that they would have to renegotiate their merger deal.
Also among Dow issues, Dupont (DD: down $1.15 to $44.50, Research, Estimates) was down, while Home Depot (HD: down $1.06 to $45.52, Research, Estimates) broke the otherwise positive retail trend after a Wall Street Journal article said the company may lower sales growth estimates at its analyst meeting later this week.
But Merck (MRK: up $1.12 to $67.05, Research, Estimates) and General Motors (GM: up $0.92 to $48.61, Research, Estimates) gave the Dow some balance. 
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