NEW YORK (CNNfn) -Retail sales and analysts recommending technology shares picked the tune to which Wall Street danced Thursday, but the drumbeat of profits remained the strictest arbiter of which stocks would rise or fall.
Staples (SPLS) was one of the day's earnings-driven stories, climbing 1/2 to 28-1/2 after the company's fourth-quarter profit beat Wall Street's forecasts. The company also said response to its Internet retail site was "overwhelming."
Craft retailer Michaels Stores (MIKE) built greater profits from its own satisfying earnings report, climbing 3-9/16 to 22. The company reported fourth-quarter profit of 99 cents per share, while analysts had expected a lower per-share figure of 93 cents.
Circuit City Stores (CC) shares climbed on expectations of a better-than-expected fiscal fourth quarter, jumping 4-1/16 to 61-1/8. The company expects to earn 83-86 cents per share despite an expected per-share charge of 31 cents due to its investment in the DIVX home-video format.
On the downbeat side, International Game Technology (IGT), which makes computerized casino machines, lost 3-3/8 to 14-15/16 after warning shareholders that flat shipments could cause its fiscal 1999 to fall short of estimates. CS First Boston lowered the company's rating to "hold" from "buy."
Wheelmaker Hayes Lemmerz (HAZ) tumbled 2-3/16 to 22-1/4 after its fourth quarter disappointed Wall Street with a per-share profit of only 31 cents, while analysts had expected 56 cents.
Outside the steady beat of earnings reports, shares of office payment firm CheckFree (CKFR) fell 5-3/8 to 30-1/8 on the day after Intuit (INTU) (a marketing partner of this Web site) sued the CheckFree for alleged breach of contract.
Lehman Brothers analyst Patrick Burton said CheckFree's price-to-revenue ratio is "too high," cutting the stock's rating to "neutral" from "outperform."
Oil services firms surge
Petroleum services companies enjoyed a much better session, climbing broadly as crude-oil prices jumped to a two-month high of $13.50 per barrel.
Salomon Smith Barney added to the sector buzz by upgrading its rating of Hanover Compressor (HC) to "buy" from "outperform." Hanover shares crept up only 1/16 to 23-3/4 in response, but B. J. Services (BJS) climbed 1-1/16 to 15-13/16 and Halliburton (HAL) leapt 1-21/32 to 32-1/16.
Rounding out some other sector highlights, Diamond Offshore Drilling (DO) rose 1-9/16 to 23-9/16, Smith International (SII) jumped 2-7/16 to 29-3/16 and Schlumberger (SLB) gained 3-3/8 to 55-1/8.
Bullish on big brokers
Major Wall Street brokerages were bullish on one another's prospects, helping lift the broad sector. Salomon Smith Barney analyst Guy Moszkowski lifted his first-quarter earnings estimates for Merrill Lynch and Morgan Stanley, citing strong stock-trading volumes and improving fixed-income volumes.
Moszkowski raised his benchmark for Morgan Stanley (MWD) to $1.30 from $1.20, helping lift shares of that firm 1-5/16 to 94-1/8.
Merrill Lynch (MER) climbed 3-7/8 to 81-9/16 after Moszkowski raised that firm's mark to $1.20 from $1.05. Merrill was also named the best investment bank of 1999 by smaller European companies in a Reuters poll.
Other brokerage plays climbed without benefit of optimistic remarks, led on a net basis by Legg Mason (LM), which surged 1-3/16 to 29-3/16. Lehman Brothers (LEH) gained 1-3/8 to 56-5/16, Bear Stearns (BSC) rose 13/16 to 44-3/16 and Donaldson, Lufkin & Jenrette (DLJ) climbed 1-7/16 to 54-7/16.
Street buying retail
Generally encouraging same-store retail sales reports unleashed a flood of stock shopping, pushing shares of many retailers higher.
Liz Claiborne (LIZ) shares were marked up 7/8 to 33-3/16, while the combination of sales figures and a $100 million stock buyback helped Ann Taylor (ANN) climb 2-7/8 to 41-7/8.
J.C. Penney (JCP) leapt 2-1/16 to 38-3/8, while apparel chain American Eagle Outfitters (AEOS), which overnight reported a staggering 33 percent increase in same-store sales, gained 11/16 to 73-11/16.
Among the retail blue chips, Wal-Mart (WMT) climbed 1-1/8 to 88-1/2 on the back of its strong same-store figures and Sears (S) jumped 2-3/8 to 43.
Saks (SKS) was less fortunate, sliding 3-1/16 to 32-15/16 after slow clothing sales led to flat sales figures for the month.
Tiffany & Co (TIF) gained 1-5/16 to 62-5/16 without falling back on sales figures, instead benefiting from the Salomon Smith Barney seal of approval. The brokerage rewarded the jeweler for reporting better-than-expected fourth-quarter results on Wednesday, recommending it as a "buy."
Tech stocks power up
On the high-tech front, hand-held computing company 3Com (COMS) shrugged off its recent casualties to climb 5/16 to 24-7/8, buoyed not only by sudden bargain hunting but by reports that German electronics giant Siemens may be looking to pay $1.2 billion for its networking unit.
Likewise beleaguered Micron Technology (MU), majority shareholder of Micron Electronics (MUEI), regained 1-7/8 to 54-1/2 after being called a "strong buy" by Gruntal & Co. Shares of both Microns have slid in recent days after Micron Electronics warned Wall Street of disappointing profits ahead.
Encouraging analyst comments also helped software maker Adobe Systems (ADBE), which saw shares surge 4-1/2 to 44-11/16 after Merrill Lynch rated the stock "accumulate."
Applied Micro Circuits (AMCC) learned that a positive recommendation can make little difference. Needham raised the stock to "buy" from "hold," but shares fell 1-1/2 to 36 anyway after the telecom chipmaker said it will buy Cimaron Communications for $115 million.
More directly stung by the ratings game, networker Level One Communications (LEVL) fell 5-9/16 to 26-13/16 after Adams Harkness stripped it of its "strong buy" recommendation, rating it "accumulate" instead.
On a higher level, Level Three Communications (LVLT) climbed 1 to 56 on growing enthusiasm over the would-be global Internet networker's upcoming secondary stock offering. The company increased the size of the offering to 25 million shares from 20 million shares.
On the Internet, a marketing deal with Web leader Yahoo! (YHOO) helped Paging Network (PAGE) surge 15/16 to 5. Yahoo! will provide Web content over the wireless provider's PageNet starting in the second quarter.
Internet venture-capital firm CMGI (CMGI), meanwhile, slid 3-15/16 to 138-3/4 after buying privately-held Activerse, which makes the instant Internet messaging program, "Ding."