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Semiconductor industry

Stocks Surge on Earnings Reports and Stock Splits

Strategic Insights

— 1 min read

As the Nasdaq composite index reached an all-time high, stocks surged on fourth-quarter earnings reports and stock-split announcements from blue-chip companies, including Microsoft, Intel, Yahoo, and Cisco Systems. The Dow Jones industrial average and S&P 500-stock index also gained, with the Russell 2000 index of smaller companies and Thestreet.com's index of 20 Internet companies rising significantly. Despite the strong gains, analysts and traders warned that the market remains vulnerable, citing concerns over the economic situation in Brazil and potential declines in technology stocks.

Key Takeaways:

  • The Nasdaq composite index rose 64.10 points, or 2.71 percent, to 2,433.41, propelled by gains in stocks like Microsoft, Intel, Yahoo, and Cisco Systems.
  • The Dow Jones industrial average gained 121.26, or 1.32 percent, to 9,324.58, with announcements of stock splits from IBM, McDonald's, and Xerox contributing to the gain.
  • The Standard & Poor's 500-stock index rose 18.33, or 1.5 percent, to 1,252.31, with technology shares, including IBM and Microsoft, leading the gain.
  • The Russell 2000 index of smaller companies gained 3.22 points, or eight-tenths of a percent, to 425.33, while Thestreet.com's index of 20 Internet companies rose 23.51, or 4.7 percent, to 520.10.
  • Analysts warned that despite the strong gains, the market remains vulnerable, citing concerns over the economic situation in Brazil and potential declines in technology stocks.
  • Stocks like Yahoo, Mindspring Enterprises, and Lucent Technologies saw significant gains, while companies like Xerox and McDonald's announced stock splits.
  • Drug stocks, which have been trending lower, recovered some ground on positive earnings reports from companies like Johnson & Johnson, Merck, and Schering-Plough.

Statistics:

  • The Nasdaq composite index is up just under 11 percent so far this year.
  • The Dow Jones industrial average rose to within 320 points of its Jan. 8 closing record of 9,643.32.
  • The price of the 30-year Treasury bond fell 4/32, to 101 28/32, with the bond's yield rising to 5.13 percent, from 5.11 percent on Monday.
  • The Russell 2000 index of smaller companies gained 3.22 points, or eight-tenths of a percent, to 425.33.
  • Thestreet.com's index of 20 Internet companies rose 23.51, or 4.7 percent, to 520.10.

Sources:

  • Associated Press
  • Bloomberg Financial Markets
  • Thestreet.com
  • Merrill Lynch & Company

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