Sector Watch: Oracle Forecast Boosts Enterprise Software Makers

By Dan Bernstein ,

Software stocks were on the rise today after

Oracle's

(ORCL) - Get Report

vision last night offered hopes of an industry upswing in the second half of 2001. The

Dow Jones U.S. Software Index

gained 4.6%, and the

Goldman Sachs Technology Index - Software

climbed 5.3%.

After topping analysts' fourth-quarter earnings expectations but missing revenue projections, Oracle executives said

they believe they have reached the bottom. Shares of Oracle recently rose 13.5% to $16.85.

"Oracle is the bellwether for that part of the sector, even more than

Microsoft

(MSFT) - Get Report

, because Microsoft is PC and boxmaker dependent," said Doug Myers, the vice president of equity trading at

IJL Wachovia

.

Microsoft was gaining 2.5% recently, while other enterprise software developers posted much larger gains. Germany's

SAP

(SAP) - Get Report

, regarded as Oracle's biggest competitor in Europe, climbed 7.4%.

PeopleSoft

(PSFT)

jumped 8.5% to $43.07, off the day's high of $43.89.

Shares of

Veritas

(VRTS) - Get Report

rose 4.6% to $63.43.

BEA Systems

(BEAS)

gained 6.4% to $30.26.

Oracle received a series of upgrades this morning following last night's earnings and outlook.

Merrill Lynch

raised the stock to a long-term buy from accumulate, Salomon upgraded it to market outperform from neutral and

Credit Suisse First Boston

analyst Wendell Laidley boosted the company to strong buy from buy.

Siebel

(SEBL)

climbed following the Oracle news but was also lifted by an analyst's upgrade of its own.

Salomon Smith Barney's

Heather Bellini

bumped the software maker up to a market outperform rating from a neutral rating. Shares of Siebel rose 9.6% to $41.96.

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