Amazing what a little pessimism can do for the stock market.
With many market players and pundits suggesting the run to
was on permanent hiatus, stocks jumped solidly higher today.
Dow Jones Industrial Average
moved beyond the millennial mark several times in the waning moments of trading, hitting an apex of 10,001.51, before closing up 118.21, or 1.2% to 9997.62. The index bested the record close of 9958.77 set
also parlayed a late-day surge to eclipse its all-time best of 1307.26, rising 18.78, or 1.4%, to 1316.55.
Aside from torturing
producers and traders wanting to wear those "Dow 10,000" hats, the Dow's inability to sustain five figures sparked debate about whether 10,000 represents a barrier.
"I don't think it is a technical level where you'll see a significant amount of sell programs just due to the fact we hit 10,000," countered Rosanne Lang, vice president of program trading at
. "I don't think it'd be a reason for sell programs to hit. I heard a commentator on
say that and it sounds corny to me. If it's going to sell off it'll sell off due to major fundamentals or a switch in psychology."
Regardless, blue-chip proxies enjoyed the best of both worlds as financial stocks rallied in concert with the bond market while consumer, transportation and technology names also advanced. The February
Consumer Price Index
and January trade report provided further evidence the economy remains strong but inflation in check, helping the 30-year Treasury bond rose 8/32 to 96 15/32, its yield sliding to 5.49%. (For more on the bond market and the economic reports, see today's late
Moreover, a rise in crude prices reversed course midday; after climbing as high as $15.55, April 1999 crude oil futures closed down 5 cents at $15.
Transports stormed higher in reaction. The
Dow Jones Transportation Average
rose 96.28, or 2.9%, to 3433.07 while the
American Stock Exchange Airline Index
was a big influence on the transportation average, rising 5.6% after posting better-than-expected earnings and setting a 2-for-1 stock split.
led Dow gainers and most financial names rallied. The
Philadelphia Stock Exchange/KBW Bank Index
climbed 3.1% while the
American Stock Exchange Broker/Dealer Index
was the biggest drag on the Dow, falling 3.6% after late yesterday saying the dollar's rally could mean first-quarter earnings estimates are too high.
Technology stocks were also big participants in the broad market's advance, although
Still, most other tech bellwethers were notably higher.
rose 6.5% to another new high, 116 5/8, after completing its acquisition of
. Because of its recent stock price appreciation and the addition of Netscape,
Standard & Poor's
said AOL's weighting in the S&P 500 index has increased to 1.04% from 0.94%, prompting index fund managers to add more shares accordingly.
One market watcher, who requested anonymity, noted AOL's recent rise has brought its market capitalization to over $100 billion, or roughly two-and-a-half times that of
, which rose 4.5% today. "It's ridiculous," he said. "Guys are holding their nose and buying the stock. But they're buying."
'I think it acts very well,' D.A. Davidson's Jim Volk said of the market. 'Yes, everything is expensive and the breadth is narrow, but every time you get these minicorrections it bounces right back.'
Thanks to AOL's rise,
TheStreet.com Internet Sector
index gained 8.53, or 1.4%, to a record 617.46. The DOT was also fueled by
up 5.2% after setting a 2-for-1 stock split, and
, up 5.6% after receiving a new buy recommendation from
Salomon Smith Barney
TheStreet.com E-Commerce Index
gained 6.90, or 6.3%, to an all-time high of 116.61.
The completing of the AOL-Netscape deal also unwittingly aided
, which has claimed the AOL-Netscape combination proves the
antitrust case has no merit.
Microsoft rose 3.2%, helping the
Nasdaq Composite Index
gain 33.99, or 1.4%, to 2426.96.
Other bellwethers on the rise included
, which rose 1% after receiving
positive comments from
U.S. Bancorp Piper Jaffray
new semiconductor analyst, Joe Osha. The
rose 1.9% and the
Philadelphia Stock Exchange Semiconductor Index
More than Dow 10,000, traders said today's action was influenced by tomorrow's triple-witching session, when index futures, index options and stock options expire concurrently.
"I think a lot of times people anticipate the triple-witch and the consensus has been it will be to the buy side," said Jim Volk, co-head of institutional trading at
in Portland, Ore. "People buy today because they figure the market will open up tomorrow and rally into the close" because of the expirations.
Volk, who has been skeptical of the market's advance, was impressed by its performance today.
"I think it acts very well," he said. "Yes, everything is expensive and the breadth is narrow, but every time you get these minicorrections it bounces right back."
New York Stock Exchange
trading, 834.6 million shares traded while advancers bested declining stocks 1,559 to 1,353. In
Nasdaq Stock Market
activity 943.8 million shares were exchanged while losers led 1,993 to 1,927. New 52-week lows led new highs 66 to 45 on the Big Board and by 97 to 71 in over-the-counter trading.
More Bullishness From Goldman
"What's going on is we went up 10% in four weeks and -- forget about 10,000 -- that's a long way to go in a short period of time," said Al Goldman, chief market strategist at
A.G. Edwards & Sons
in St. Louis. "Yesterday and the day before the market showed normal signs of fatigue, which it showed early today. Now it's getting back some of its energy."
Goldman acknowledged the lackluster breadth figures but noted upside volume more than doubled down volume on the NYSE, 545.6 million to 250.8 million.
Saying triple-witching "tends to help," Goldman foresees the Dow eclipsing 10,000 tomorrow, "if not Monday. Then we'll got to about 10,300 before we take another pause to refresh."
Perhaps because of his penchant for using phrases like "pause to refresh," or because of A.G. Edwards' locale, Goldman has not received the accolades of other market seers. Yet he has been one of the market's most vociferous bulls in recent years, and thus more right than not. More importantly, perhaps, he remains ever optimistic.
"I think we're going to go higher," he said. "This bull market is based on a very strong, very positive economic environment. It's the old Goldilocks story. We're growing at a healthy pace with inflation benign with a marketplace dominated by a mood of people wanting to buy and hold stocks for the long-term and investors in a 'glass is half full rather than half empty' attitude. That's the fuel for a bull market."
The performance of
, which rose 8% despite an earnings warning
late yesterday, embodies that attitude, he said. Investors recognized the shortfall was due to the pilots' strike and not operations and judged the news to be "ancient history."
Among other indices, the
rose 1.12, or 0.3%, to 399.55; the
Dow Jones Utility Average
gained 3.75, or 306.16; and the
American Stock Exchange Composite Index
fell 0.97, or 0.1%, to 714.86.
Elsewhere in North American equities, the
Toronto Stock Exchange 300
crept down 7.38 to 6586.44 and the
Mexican Stock Exchange IPC Index
crept up 9.63 to 4864.80.
Thursday's Company Report
Earnings estimates from First Call; new highs and lows on a closing basis unless otherwise specified. Earnings reported on a diluted basis unless otherwise specified.
As noted above, the Internet sector demanded that blue-chips share today's glitzy record stardom.
CMGI vaulted 9 3/16, or 5.2%, to 184 13/16 after last night setting a 2-for-1 stock split. Also,
The Wall Street Journal
reported that the company will allow the proposed merger of
to go to a shareholder vote instead of immediately proposing an alternative. Lycos lost 4 1/4 to 97 3/4; USA Networks rose 1 to 38 9/16.
Elsewhere in Netland,
Barnes & Noble
scored 5 1/2, or 19.1%, to 34 3/8 after it and Germany's
filed a registration statement with the
Securities and Exchange Commission
for an IPO for
, which will trade on the Nasdaq Stock Market under the symbol BNBN.
BT Alex. Brown
reinitiated coverage on Barnes & Noble and
, which lifted 7/8, or 6.1%, to 15 1/8, with buy ratings.
Rival Amazon.com climbed 7 3/8, or 5.6%, to 138 7/16 after Salomon Smith Barney started coverage with a buy and a price target of 175 a share. Salomon began coverage of
, which expanded 5 1/16 to 160 3/4, with an outperform.
, a privately held online pharmacy in which Amazon.com has a 40% stake, announced an agreement with
promoting drugstore.com on select Excite portions of Netscape's
. Excite tacked on 3 7/8 to 113; Netscape's new parent, America Online, grew 7 1/16, or 6.5%, to an all-time high of 116 1/8.
soared 19 1/16, or 35.1%, to an all-time high of 73 3/8 after the high-tech venture capital firm announced the first investment under its new focus on Internet companies announced earlier this week. Yesterday, the company said it acquired a 20% interest in
reinitiated coverage of the stock with an accumulate and near-term price target of 100 a share.
flourished 1 1/2 to 83 7/8 on a
Wall Street Journal
report that Chairman and Chief Executive Walter V. Shipley has made informal overtures to potential merger partners on Wall Street in the past year and that he has offered senior execs the possibility of a CEO slot in the merged firm. Among the firms approached, according to the
Morgan Stanley Dean Witter
and J.P. Morgan. In general, financial stocks glowed today, with J.P. Morgan up 3 11/16 to 124 3/16 and American Express up 6 11/16, or 5.5%, to 127 5/8.
J.P. Morgan Securities
started coverage of AXP at buy with a 12-month price target of 150.
Mergers, acquisitions and joint ventures
Advanced Lighting Technologies
advanced 2 15/16, or 40.5%, to 10 1/4 after last night saying
agreed to buy a $20.6 million stake in the company. Advanced Lighting said it plans to issue preferred shares to GE which convert into about 3 million Advanced Lighting shares at a $6.75 conversion rate. GE added 1 9/16 to 110.
sliced off 1 7/8 to 82 1/8 after saying it will try out
new switching enhancement designed to bring Internet protocol capabilities to voice networks. Lucent gave up 7/8 to 102 5/8. Meanwhile,
The Wall Street Journal
reported AT&T is preparing for a massive bond sale next week that could add as much as $8 billion to its coffers.
shot up 4 5/8, or 53.6%, to 13 1/4 after agreeing to provide audio content to Microsoft's MSN Web Events site. Separately, at a launch event for Microsoft's new Internet Explorer 5.0 browser,
announced plans to release the second edition of the company's Windows 98 operating system in the fall.
Circuit City Stores
rallied 7 1/8, or 10.3%, to an all-time high of 76 1/8 on word it might sell a stake in its
Digital Video Express
flew 4 11/16, or 45.5%, to 15 1/16 after a unit of France's
made an unsolicited $17.50-a-share bid for the remaining shares in the company it doesn't already own.
Earnings/revenue reports and previews
sank 1 1/2, or 20%, to 6 1/8 after last night warning of lower first- and second-quarter earnings due to weak conditions in the semiconductor industry. The company expects to post a net loss of 22 cents to 24 cents a share for the first quarter. The four-analyst view called for a loss of 13 cents vs. the year-ago profit of 27 cents. Aetrium also said it cut its workforce by about 10%.
parent AMR climbed 4 5/8, or 8%, to 62 1/8 despite last night's first-quarter earnings warning. Apparently the stock was helped by the company's other announcement -- that it will repurchase up to $500 million in stock. Blaming its 10-day pilot sickout, the airline said it sees earnings of 30 cents to 35 cents a share. The 11-analyst forecast called for 65 cents vs. the year-ago $1.62. Today, BT Alex. Brown lowered its first-quarter estimate for the company to 30 cents a share from 70 cents.
closed flat at 45 1/16 after posting first-quarter earnings of 26 cents a share, topping the 19-analyst estimate by 2 cents and moving ahead of the year-ago 18 cents.
dribbled down 5 1/8, or 21.6%, to 18 5/8 after recording fourth-quarter earnings of 25 cents a share, a penny short of the 11-analyst outlook but above the year-ago 24 cents.
soured 2, or 5.8%, to 32 1/4 even after last night reporting fourth-quarter earnings of 31 cents a share, 2 cents above expectations.
declined 1 1/8, or 6.2%, to 17 1/8 after last night saying it sees first-quarter earnings of about 28 cents a share because of difficult year-ago comparisons in its volatile platinum operations. The three-analyst estimate called for 32 cents vs. the year-ago 30 cents.
FDX excelled 5 3/16, or 5.6%, to an all-time high of 98 1/8 after posting third-quarter earnings of 52 cents a share, including costs from contingency plans related to the
pilot negotiations and merger expenses related to its acquisition of
. That's higher than the 12-analyst forecast of 41 cents but below the year-ago 65 cents. FDX also set a 2-for-1 stock split.
advanced 27/32, or 14%, to 7 after posting second-quarter earnings of 19 cents a share, 4 cents higher than the five-analyst view and ahead of the year-ago 7 cents.
tanked 3, or 23.5%, to an all-time low of 9 3/4 after last night warning it expects to report first-quarter earnings of 15 cents to 17 cents a share due to pricing pressure in the building wire market. The four-analyst view called for 37 cents vs. the year-ago 54 cents. Today, Merrill Lynch lowered the stock to intermediate-term accumulate from buy while maintaining its long-term buy.
Warburg Dillon Read
dropped it to buy from strong buy.
pushed up 4 3/8, or 6.7%, to 70 following a partial earnings announcement for its fiscal year ended Jan. 31. The release, previously scheduled for Monday, said the company's 1999 net profit was $195 million, up from $175.5 million in 1998.
3M shed 2 3/4 to 73 5/8 after executives said the dollar's rally could mean that the nine-analyst consensus calling for first-quarter earnings of 93 cents a share is too high. The company made 98 cents in the year-ago period. Merrill Lynch lowered its 1999 and 2000 earnings estimates for the company, saying, "Sales and currency were not as positive as we were anticipating in January and February."
slid 3 7/16, or 32.5%, to an annual low of 7 1/8 after last night reporting second-quarter earnings of 11 cents a share, including $300,000 in research and development costs. The four-analyst outlook called for 17 cents vs. the 18 cents. The company also warned its second-quarter sales could come in flat.
hopped up 1 1/4, or 8.6%, to 15 3/4 after beating fourth-quarter earnings estimates by 6 cents a share last night with a profit of 20 cents.
added 1 1/4, or 7%, to 19 after reporting third-quarter earnings of 31 cents a share, on target with the eight-analyst estimate but behind the year-ago 67 cents.
picked up 9/16, or 8.6%, to 7 1/8 after
upped the stock to accumulate from hold.
tacked on 3 7/16 to an all-time high of 109 1/2 after
Credit Suisse First Boston
started coverage with a buy and a price target of 120 a share.
reeled in 5, or 29.6%, to 21 7/8 after Piper Jaffray initiated coverage with a strong buy.
dropped 8 15/16, or 21.7%, to 32 1/4 after
BancBoston Robertson Stephens
slashed the stock to buy from strong buy. There's also concern on the Street that the company will miss analysts' first-quarter earnings estimates.
jumped 1 3/8, or 15.8%, to 10 1/16 after
raised it to buy from outperform.
lifted 4 1/2, or 13.2%, to 38 1/2 after naming James R. Tobin president and chief executive. Tobin has served as president and CEO of
. Yesterday, the
Food and Drug Administration
allowed Boston Scientific to market the
mapping catheter, which is used to diagnose abnormal heart beats. Today, Credit Suisse First Boston upgraded the stock to buy from hold.
changed its name to CDnow/N2K and said it will now trade under the symbol CDNWD. The stock rose 15/16, or 5.1%, to 19 7/16.
picked up 2 to 86 after saying its investigational Cox-2 specific inhibitor,
, relieved moderate to severe acute pain to the same degree and in the same amount of time as high doses of two leading traditional medicines in studies of menstrual and dental-surgery pain.
Motorola surged 3 1/8 to 72 5/8 after unveiling a new line of digital personal communications products and promising Internet-browsing capability across its entire digital mobile phone range in 2000 at the
exhibition in Hannover, Germany.