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Fed Gift-Wraps Gains for Net Stocks

The Fed isn't raising rates, which is giving investors a green light to buy.

One positive impact from Y2K fears -- the

Federal Reserve

announced that it was not raising interest rates.

Internet stocks were in rally mode after the Fed's announcement. Internet Sector

index was up 46.65, or 4.3%, at 1145.46. Among stocks in the news,


was up 4 7/8, or 8%, at 67 1/4, though it traded as high as 83 1/4. Gains came on news that its electronic commerce operations would be acquired by

, a new sporting-goods shopping Web site.

joint newsroom took a look at the deal in an earlier


The Fed's Open Market Committee announced it has not changed interest rates and also left a neutral bias, giving the green light to investors to buy. There was much speculation that the Fed would adopt a tightening bias. Among

B2B plays in the news,

Akamai Technologies

(AKAM) - Get Report

was up 16 7/8, or 6%, at 303 1/8 after announcing an alliance with

Road Runner

, a provider of cable broadband online service. Akamai technology will be used to enhance the delivery of Internet content to broadband subscribers over the Road Runner network.

Application service provider



, which split 3 for 2 after Monday's close, was up 18 7/8, or 43%, at 63 1/2 post-split today. USinternetworking seemed to benefit from positive comments from

Credit Suisse First Boston

, which reiterated a buy rating on the stock. CS First Boston analysts indicated that the company's fourth quarter was in "good shape" and revenue could be above their estimates.

(GO) - Get Report

, the tracking stock for


TheStreet Recommends

(DIS) - Get Report

online ventures, was up 5 7/8, or 27%, at 27 3/4 after an upgrade from

Schroeder & Co.

Analyst Arthur Newman raised the rating on the stock to outperform significantly from perform in line and established a price target of 33. Newman wrote that the stock was oversold, trading at a significant discount to its peers and poised for a turnaround.

Also benefiting from analysts' coverage was

NBC Internet


, the tracking stock for NBC Internet ventures.

Deutsche Banc Alex. Brown

initiated coverage of the stock with a strong buy rating. The stock was up 10 3/8, or 13%, at 89 3/8.

Also getting a boost from initiation of coverage was


, a business-to-business provider of Internet-based travel procurement.

Salomon Smith Barney

, an underwriter for the IPO last month, initiated coverage with a buy rating. It was up 10 31/32, or 35%, at 42 7/32.


Beth Kwon

mentioned stocks that could benefit after the end of their quiet period earlier this month.

We noted rumors that were surrounding

Micro Warehouse


last week, and something big did happen to the company today -- it was

bought out. A group of investors, including Hollywood executive

Michael Ovitz


Northwest Airlines


Chairman Gary Wilson and a former top


(IBM) - Get Report

executive, said today that it would acquire the catalog and online retailer of computer products for about $725 million. Under terms of the agreement, Micro Warehouse shareholders will receive $19 in cash for each Micro Warehouse share they own. It was up 2 7/8, or 19%, at 18 1/8 in recent trading.