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U.S. stocks skyrocket
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December 23, 1999: 6:01 p.m. ET
Major indexes end in record territory; tech euphoria continues
By Staff Writer Jill Bebar
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NEW YORK (CNNfn) - Wall Street’s love affair with technology stocks showed no signs of ending Thursday, with all three major indexes roaring into record territory.
Despite warnings from Wall Street experts that stocks are becoming overvalued, investors poured billions of dollars into the market Thursday, pushing the Dow to its highest level in nearly four months and the Nasdaq to its highest level in 24 hours.
For many participants, the Nasdaq’s daily records have become almost commonplace. But, with the stock market closed on Friday for the Christmas holiday, Wall Street will have to wait until Monday to see if the rally continues.
"It’s phenomenal. People are convinced money flows will continue onward and upward,” said Ned Collins, head of trading at Daiwa Securities America.
The Dow Jones industrial average soared 202.16 points, or 1.8 percent, to 11,405.76 - topping the previous record close of 11,326.04 set on August 25. For the year, the blue chip index is now up more than 24 percent.
The Nasdaq composite rose 32.14 points to 3,969.44 on active volume of 1.28 billion shares. The index traded as high as 4,001.63 earlier in the day, marking the first time the Nasdaq pierced the 4,000 level in its 28-year history.
For the week, the Nasdaq gained another 5.8 percent, bringing its total rise for the year to a stunning 81 percent.
The Nasdaq’s surge this year has clearly caught many Wall Street analysts by surprise. Only 17 months ago, the Nasdaq was trading at 2,000 and few, if any market participants were predicting Nasdaq 4,000 before the start of the new millennium. By comparison, the Dow industrials took eight years to rise from 2,000 to 4,000.
In the last few weeks, technology stocks have become the place to be for investors. Stocks like Yahoo! are up more than 300 percent and tech leaders such as Cisco are up more than 150 percent.
By comparison, blue chip stocks such as Exxon are up only 10 percent this year.
"It’s all technology. The overall market’s gains are being driven by tech stocks,” said Bill Meehan, chief market analyst at Cantor Fitzgerald. "We have not had anything resembling a pullback since October. I don’t expect to see a pullback until February.”
"The buyers are there and the sellers are finished for the year for the most part. Those who have cash sitting on the sidelines are putting it to work," said Michael Lyons, senior trader at Morgan Stanley Dean Witter.
The S&P 500 index advanced 22.35, or 1.6 percent, to 1,458.34. Its all-time high close was 1,433.30 on Dec. 3.
The S&P 500 added 2.6 percent for the week and is now up 18.6 percent for the year.
On the New York Stock Exchange, breadth was positive, with gainers leading losers 1,907 to 1,149. Trading volume reached 732 million shares.
Treasury prices fell in an abbreviated pre-holiday session. The bellwether 30-year bond lost 13/32 of a point in price, raising its yield to 6.48 percent from 6.45 percent late Wednesday.
In currency markets, the dollar rose against the yen and fell against the euro.
Among the top gainers, Gemstar International Group (GMST) jumped 9-5/16, or more than 14 percent, to 74-15/16 after the Nasdaq said Wednesday the media firm will join the Nasdaq 100 index, replacing Qwest Communications International (QWST), effective Jan. 3. Qwest was unchanged at 43-13/16.
Micron Technology (MU) fell 2-1/4 to 73-3/4 despite posting stronger-than-expected earnings after the market close Wednesday. The semiconductor memory manufacturer reported fiscal first-quarter income of $341 million, or $1.19 a share, against analysts’ forecasts of 85 cents.
Following the earnings release, several Wall Street brokerage firms increased their earnings estimates on the stock for next year and the following year.
Among semiconductor issues, Intel (INTC) rose 5/8 to 83-1/8 and Applied Materials (AMAT) gained 11/16 to 121-5/8. But Advanced Micro Devices (AMD) reversed earlier gains, falling 3-16 to 28-5/8.
Microsoft (MSFT) also gave back the day’s gains, edging down 1/8 to 117-7/16. The world's No. 1 software company said late Wednesday its chief financial officer, Greg Maffei, resigned to join Worldwide Fiber, a privately held Vancouver-based firm. The company named John Connors, a veteran Microsoft manager, to replace Maffei effective Jan. 7.
Following the announcement regarding Connors, Paine Webber raised its price target for Microsoft to $150 from $120, and Credit Suisse First Boston maintained its "strong buy” rating on the stock.
Other tech-leaders contributed to gains. Hewlett Packard (HWP), a member of the Dow industrials, rose 5-11/16 to 112-5/8 and Dell (DELL) advanced 2-3/8 to 52-11/16.
Widespread gains
Aside from technology, the market’s strength was broad based, with many sectors such as pharmaceutical and financial issues posting gains.
In the retail sector, Tandy (TAN) rose sharply, advancing 3-5/8 to 46-1/8 after Merrill Lynch upgraded the stock to "near-term buy” from "near-term accumulate.”
(Click here for a look at today’s CNNfn hot stocks.)
(Click here for a look at today’s CNNfn technology stocks.) 
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