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Market Update: Dow and Nasdaq Bounce Into Afternoon

Tech stocks overcome earnings woes, blue-chips strengthen after weak morning.

Tech stocks were overcoming earnings woes to chalk up modest gains in afternoon trading, while the blue-chips continued to show strength after moving lower in the early going.

Lately, the

Dow Jones Industrial Average

climbed 35.5 to 11,231, with its components gaining upward momentum.

J.P. Morgan

(JPM) - Get JPMorgan Chase & Co. (JPM) Report

, which has remained 1.9% higher, stepped back after merger speculation put the investment bank to a new all-time high level of $176.



was still losing almost 1.5% after yesterday's news that it was negotiating a possible acquisition of


consulting division.

Meanwhile, the tech-laden


was climbing 37.1 to 3933.4. The index was enjoying a relief rally following yesterday's losses which stemmed from a Wall Street analyst's concerns that Big Blue


(IBM) - Get International Business Machines (IBM) Report

third- and fourth-quarter revenue would be hurt by currency exchange rates.


PRI Automation


, a semiconductor equipment maker, was the latest tech to issue a fourth-quarter earnings warning. The company, which plummeted 40%, cited supply-chain problems in its factory systems unit as the culprit.

The Internet Index

was bouncing 14.13 to 812.37, with

Check Point

(CHKP) - Get Check Point Software Technologies Ltd. Report

ahead 5.7%.

Elsewhere, the broader

S&P 500

was mounting 2.5 to 1491.8, while the small-cap

Russell 2000

was slightly higher, 1.7 to 535.3.

Sector Watch


Dow Jones Utility Average

was shedding earlier gains after hitting another intra-day high of 399.02. Spiking energy prices shot

TheStreet Recommends

Duke Power

(DUK) - Get Duke Energy Corporation (DUK) Report

to another all-time high of 83 3/4, while


(PE) - Get Parsley Energy, Inc. Class A Report

topped to 56 3/4.


American Stock Exchange Oil & Gas Index

jumped to a new all-time high of 548.79 before falling fractionally lower. Yesterday, oil stocks soared following


decision to raise output by 800,000 barrels per day. The increase wasn't enough to drive down the price of oil, which hit $35.85 a barrel.


Philadelphia Stock Exchange Oil Service Index

also hit a new high of 143.98, before tapering off 1%. Due to the high price of oil, companies are increasing their capital spending budgets in order to extract more oil, giving oil services companies even more business.

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Treasuries are narrowly mixed on little news. With no major economic releases on the calendar, bond traders are keeping an eye on oil, which is lower so far, and on the corporate bond calendar, which is unusually heavy. Heavy corporate bond issuance can put pressure on Treasury prices.

A couple of


governors have piped up at the

National Association for Business Economics

conference underway in Chicago, but their comments largely cancel each other out.


Robert McTeer

, president of the

Dallas Fed

, in an interview in today's

Wall Street Journal

, raised the specter of interest-rate cuts, assuming that energy prices peak and the inflation rate declines. But

Chicago Fed


Michael Moskow

in comments to reporters this morning said the risk of too-high inflation is still greater than the risk of too-slow growth. Neither McTeer nor Moskow is a voting member of the

Federal Open Market Committee this year.

The benchmark 10-year Treasury note lately was down 3/32 at 99 24/32, lifting its yield to 5.783%.

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