The Dow rallied into the close today ahead of tomorrow's Federal Reserve meeting, while the Nasdaq Composite Index did its best to catch up.
The Comp gained 78.59, or 2.2%, to 3607.65 after dropping as low as 3445.13.
TheStreet.com Internet Sector
index, or the DOT, pocketed 37.7, or 4.4%, to 881.2. The Dow rose 198.41, or 1.9%, to 10,807.78.
Traders showed a bit of restraint in tech shares in advance of tomorrow's meeting. Light volume was providing some volatility.
Barry Hyman, senior market analyst with
Ehrenkrantz King Nussbaum
, was in agreement with consensus estimates looking for a 50-basis-point hike by the Fed. And like many other observers, he also is looking for a post-meeting rally, saying that strong performance by financial stocks today suggests a positive outcome after the meeting.
However, Hyman does not expect a sustained rally that would take the Nasdaq back to 5000. Rather, he said he still sees the Nasdaq in a trading range between 3200 to 4100 and 4200, making it more of a "traders' market" than one for longer-term investors.
Hyman said he still sees valuation concerns among Nasdaq stocks and investors continuing to put money into value stocks. But he said the low volume that has been seen of late suggested a "slow migration away from technology, which is good and the way it should have been." Hyman, however, said there will come a time when the value plays become fully valued and investors will return to tech.
He expects the Fed, sometime in the third quarter, to be closer to completing its tightening cycle, and the market to be through its summer doldrums period. A rally then, he added, would be more lasting.
Hyman also was not discounting a trading range below the recent low of around 3230 in the Nasdaq. He said a final washout "would be an ideal situation because I do believe growth investing is still the way to play."
Gains in the DOT were being fueled by
, which lifted 7 13/16, or 14.4%, to 61 15/16 amid ongoing talk of an eventual buyout of the company by
Also among the day's movers,
gained 2 9/16, or 13.3%, to 21 7/8;
bounced up 6 1/16, or 16.3%, to 43 3/16.
Among business-to-business plays,
lost 3 to 66 1/16 and
popped 5 7/16, or 5%, to 114.