Advertisement
YOU ARE HERE: LAT HomeCollections

MARKET SAVVY

Tech Issues Lift Nasdaq; Blue Chips Limp Along

October 27, 1998| From Times Staff and Wire Reports

Wall Street closed mostly higher again Monday, with smaller stocks and technology issues again in the lead.

Blue chips, by contrast, had a lackluster day--which might have been fortunate for the New York Stock Exchange, given a nearly hourlong trading interruption caused by a computer glitch.

Meanwhile, bond yields fell back as the dollar rose.

Fresh buying of technology shares after a bullish personal computer sales report boosted the Nasdaq composite index 31.12 points, or 1.8%, to 1,724.98.

And the Russell 2,000 index of smaller stocks rose for a ninth consecutive session, gaining 1.4% to 372.07, as investors continued to hunt for beaten-down small stocks.

The Dow Jones industrials, however, eased 20.08 points to 8,432.21. And the Standard & Poor's 500 index was up marginally.

Still, winners topped losers by 18 to 13 on the NYSE and by 24 to 17 on Nasdaq.

Trading was halted on the NYSE for 59 minutes at midday because of a haywire computer switch. When trading resumed at 2:15 p.m. EST, the Dow added 26 points to the 41-point gain before the halt, then slumped.

Tech stocks, however, were strong all day. The NYSE outage didn't affect Nasdaq trading.

Tech shares were hot as investors focused on reports that worldwide personal computer shipments rose slightly more than expected in the third quarter, buoyed by strong demand in the U.S. and Europe.

International Data Corp. said PC unit shipments rose 15% from a year ago, while Dataquest Inc. said shipments rose 14%. IDC had expected growth of 11%. In the U.S., PC shipments rose 14%, IDC said, while Dataquest put U.S. shipment growth at 18%.

Whatever numbers they believed, investors sent shares of many PC-related stocks higher.

Dell jumped $4.25 to $62.50, Gateway gained $4.13 to $55.75, Apple rose $1.94 to $37.44 and Compaq added 63 cents to $29.50.

In the bond market, long-term Treasury yields fell for the first time in seven days after a report showing weaker-than-expected home sales suggested the economy is losing steam.

"We're seeing weakening economic conditions" that will keep bond yields low, said Richard Caro, who helps oversee $8 billion at Summit Bank Corp.

The 30-year T-bond yield slid to 5.11% from 5.18% on Friday.

Bonds also may have been helped by the dollar, which had its biggest gain against the German mark in nine months and rose against other European currencies after the Bank of Italy lowered its benchmark interest rate--fueling talk that other central banks, including Germany's Bundesbank, may follow suit.

The dollar also rose against the yen, topping 119 yen.

Among Monday's highlights:

* Other tech shares gaining included IBM, up $1.50 to $143.06; Sun Microsystems, up $1.69 to $54.19; Cisco Systems, up $2.69 to $61.38; and Intel, up $1.69 to $88.94.

Internet names also surged, including Yahoo, up $5.81 to $127.94, nearing its record high of $134.63.

* Many retailers' shares fell on worries that consumer spending may ease--the robust PC shipments data notwithstanding. Wal-Mart Stores slumped $2.63 to $65.38 and Federated Department Stores lost $2.06 to $39.44.

* Bankers Trust dropped $4 to $62.88. Deutsche Bank's chairman told German newsmagazine Der Spiegel that his bank has not held takeover talks with Bankers Trust. Shares of the U.S. bank rose almost 30% last week, partly on speculation of a takeover by Deutsche Bank and partly on BT's announcement that it made money in October, after reporting a $488-million third-quarter loss.

* FDX fell $3.19 to $48.31 after pilots of the world's largest air freight company were given approval by members to order a slowdown at Federal Express during the holiday shipping season.

*

Market Roundup, C13

Advertisement
Los Angeles Times Articles
|
|
|