|
Nasdaq scores a record
|
 |
February 4, 2000: 5:55 p.m. ET
Gains among high-tech issues boost composite index; Dow, S&P decline
By Staff Writer Jill Bebar
|
NEW YORK (CNNfn) - The Nasdaq composite index climbed to a record close Friday -- its fifth consecutive day of gains -- led by a stellar performance among many bellwether technology stocks.
"It was pretty much exclusively by midday a Nasdaq rally," said Terence Gabriel, strategist at IDEA global.com.
The Nasdaq composite index rose 33.16 points to 4,244.14, surpassing its previous all-time high close of 4,235.40 on Jan. 21. The index jumped 9.2 this week.
 But a poor performance among cyclical stocks pressured the blue-chip index. The Dow Jones industrial average fell 49.64 points to 10,963.80. The index finished the week with a gain of 2 percent. The S&P 500 index eased 0.63 to 1,424.34. The index added 4.7 percent this week.
On the New York Stock Exchange, declines outnumbered advances 1,574 to 1,417 as trading volume reached 1 billion shares. On the Nasdaq, advances led declines 2,151 to 1,979, on volume of 1.75 billion shares. 
Treasury prices fell. The benchmark 30-year bond lost nearly two full points, which raised its yield to 6.27 percent from 6.14 percent late Thursday.
The dollar fell against the yen and rose against the euro.
A strong jobs report
Throughout most the session, investors did not express concern about the latest economic news, with U.S. job creation taking its biggest monthly jump in more than two years. The economy generated 387,000 new jobs in January, according to the Labor Department, far more than analysts' forecasts of 270,000 and the largest increase since September 1997.
The unemployment rate fell to 4.0 percent, its lowest level since January 1970. Average hourly wages jumped 6 cents to $13.50 an hour, a larger-than-expected gain of 0.4 percent. The component, a measure of inflation, is said to be closely watched by Federal Reserve Chairman Alan Greenspan.
The strong data follow Wednesday's Federal Reserve interest rate hike of a quarter percentage point, which was in line with expectations. The central bank continued the tightening process it began last year, when it raised interest rates by a quarter point three times in an effort to slow economic growth. The policy statement it released Wednesday warned about inflationary imbalances and strongly hinted of future rate hikes.
"Everyone expected the unemployment rate to slip to 4 percent. It appears the Fed is a lot more afraid of the market than the market is afraid of the Fed," said Bill Meehan, chief market analyst at Cantor Fitzgerald.
Joseph Battipaglia, chief investment strategist at Gruntal & Co., agreed. He told CNNfn investors have an understanding of Fed monetary policy and are not as fearful of rate hikes as they were last year. (210K WAV) (210K AIFF)
"Today's report is not going to scare market participants into thinking the Fed needs to quicken its pace of tightening," said Mike Krauss, chief technical strategist at Chase Securities.
Kraus noted the upcoming producer and consumer price reports will be significant. The producer price index measures inflation at the wholesale level and is scheduled for release Feb. 17. The consumer price index, a measure of inflation at the retail level, is scheduled for Feb. 18.
Cyclical stocks slip...
But analysts said some inflation concerns did creep into the market in late trade, pressuring the blue-chip index. Cyclical stocks, which tend to be sensitive to changes in the economy, suffered noticeably.
 Among the Dow components, Alcoa (AA: Research, Estimates) retreated 1-3/4 to 70-1/2, International Paper (IP: Research, Estimates) declined 5/8 to 45-5/8, and Minnesota Mining and Manufacturing (MMM: Research, Estimates) dipped 2-5/8 to 89-1/16.
...while the Nasdaq climbs
The Nasdaq composite index continued its winning streak, proving its resilience despite strong economic news that heightens rate hike fears among investors.
"The stalwarts are tech stocks. It's almost as if they are independent of other concerns that might weigh on the overall market," said Brian Conroy, head of listed trading at J.P. Morgan.
Bolstering the index were strong gains in many bellwether tech components. Microsoft (MSFT: Research, Estimates) rose 2-15/16 to 106-9/16, Intel (INTC: Research, Estimates) added 9/16 to 104-3/4, and Cisco Systems (CSCO: Research, Estimates) advanced 3-5/16 to 121-1/8.
Cisco benefited from Warburg Dillon Read raising its price target on the stock to 140 from 100.
Nevertheless, Christine Callies, stock strategist at Credit Suisse First Boston, told CNNfn technology stocks were not immune to profit taking. (328K WAV) (328K AIFF)
Weighing on the Nasdaq was Red Hat (RHAT: Research, Estimates), declining 5-15/16 to 92-11/16. The company, a leading distributor of the Linux operating system, has made a secondary public offering of 4 million shares at $95 each.
And CNET (CNET: Research, Estimates) gave back an earlier gain, ending down 1 at 51. The Internet provider late Thursday reported a smaller-than-expected loss of 40 cents per share in the fourth quarter. Earnings tracker First Call had forecast 44 cents.
Telecoms advance on merger news
Merger activity also drew investors' attention Friday, after German telecom operator Mannesmann accepted Vodafone AirTouch's $198 billion takeover offer, the largest ever.
British telecommunications company Vodafone AirTouch (VOD: Research, Estimates) American depositary receipts (ADRs) slumped 3-15/16 to 57-13/16. Mannesmann does not have ADRs.
The merger news fueled gains within the telecommunications sector. AT&T (T: Research, Estimates), the nation's No. 1 telecom company, rose 5/16 to 50-5/8, and Bell Atlantic (BEL: Research, Estimates) advanced 1/8 to 58-9/16.
Among individual issues, shares of Mattel (MAT: Research, Estimates) reversed course after an early gain, falling 1/8 to 10-3/4. The No. 1 toy maker in the world ousted Chairman and CEO Jill Barad late Thursday after posting disappointing fourth-quarter results.
Click here for a look at today's CNNfn hot stocks.
Click here for a look at today's CNNfn technology stocks. 
|
|
|
|
|
 |
|
