Technology Stocks Surge to Record Highs Amid Anemic Earnings

Strategic Insights -

Technology stocks led the market to record highs on Wednesday, with Intel and Compaq Computer posting anemic first-quarter profits that barely surpassed Wall Street's decreased expectations. Despite initial concerns, the Dow Jones industrial average recovered from brief losses to close at 9,162.27, its second consecutive record high. The technology-heavy Nasdaq composite reached a new high, while most broad-market indicators struggled before turning higher near the close.

Key Takeaways:

  • Technology stocks, led by Intel and Compaq Computer, reached record highs on Wednesday despite anemic earnings reports.
  • Intel's plan to slash costs by cutting 3,000 jobs helped supplement its report, but the company ultimately traded 1 1/8 lower at 74 7/8.
  • Compaq rose 9/16 to 26 5/8 as the most active issue on the New York Stock Exchange.
  • IBM and Hewlett-Packard rose 3 1/2 and 2 13/16 to 109 3/4 and 63 3/4, respectively, as two of the Dow's biggest gainers.
  • Microsoft and Cisco Systems rose 2 15/16 and 3 to 91 3/8 and 70 11/16, respectively, leading the Nasdaq advance.
  • Companies have successfully reduced analyst expectations, according to Bill Barker, chief investment strategist at Dain Rauscher.
  • The Nasdaq composite rose 20.23 to 1,863.26, surpassing its previous best finish of 1,855.40 on April 3.

Statistics:

  • The Dow Jones industrial average closed at 9,162.27, its second consecutive record high.
  • Intel traded 1 1/8 lower at 74 7/8 as the most active Nasdaq issue.
  • Compaq rose 9/16 to 26 5/8 as the most active issue on the New York Stock Exchange.
  • The Nasdaq composite rose 20.23 to 1,863.26, easily surpassing its previous best finish of 1,855.40 on April 3.
  • The Dow Jones industrial average surrendered gains of more than 30 points twice on Wednesday before turning higher.

Sources:

  • "Associated Press"
  • "Bill Barker, Chief Investment Strategist at Dain Rauscher in Dallas"