(Updated from 11:13 a.m. EDT)

Blue-chips were rising and tech stocks were seeing red this May Day, a day after the

Nasdaq finished the month of

April up 15%.

Bolstered by improving sentiment, some good earnings news and a round of data showing the economy is in better shape than many believed, the major market averages swung sharply higher in April. But stocks reacted in mixed fashion to this morning's

National Association of Purchasing Management's

purchasing managers' index for April, which showed the manufacturing sector is doing only slightly better, but that the overall pace of recovery remains sluggish.

The PMI, which polls manufacturing executives around the country, rose to 43.2 in April from 43.1 in March. Economists polled by

Reuters

had been expecting the PMI to rise to 43.8. Any reading less than 50 indicates contraction in the manufacturing sector, any figure more than that indicates expansion. This report, a good proxy for activity in manufacturing, has come in less than 50 for the past nine months because of a pullback in business investment and declining demand. But today's report shows that the drawdown of existing inventories is accelerating and that companies are continuing to get products off the shelves.

The Dow was getting a boost from consumer products giant

Procter & Gamble

(PG) - Get Report

, which was rising 6.3% to $63.90. The maker of Tide detergent and Crest toothpaste posted third-quarter earnings of 71 cents a share vs. 64 cents a share a year ago, excluding restructuring charges. That beat the Street's consensus expectation of 69 cents a share. The company recently said it is considering selling its Jif peanut butter and Crisco oil brands because the products are dragging on the company's financial health.

"There's a lot of uncertainty; the market is a mixed bag and lacks direction," said Patrick Boyle, head financial trader at

Credit Suisse First Boston

. "We've had a couple of great weeks, but there's some profit-taking -- but there could be buying on the way, as some people missed the rally."

The retail and banking indexes were rising a bit, while oil, drugs and tobacco were dipping. "We're seeing some fairly steady, nondescript market rotation," said Mayer Offman, chief trading officer at

Carlin Equities

. "The market is finding groups that are cheaper -- pile in, get the money -- and selling off on other groups," Offman said.

An upgrade from Goldman Sachs of

priceline

(PCLN)

to outperform from perform has the stock jumping 24.1% to $6.02. Analyst Anthony Noto cited an "improved outlook" amid job cuts, improved customer service and stabilized growth. The analyst also said priceline.com is in a "turnaround phase" and that the company's first quarter could potentially be its last unprofitable one. The company, which reports earnings today, gained about 46% in the last five days.

Online travel service

Expedia

(EXPE) - Get Report

hit a new 52-week high of $29 earlier this morning on news the company had posted its first profit. It was lately up 7.4% to $27.94. Expedia had earnings of 9 cents a share before noncash items, much higher than the expected 13 cent per-share loss.

Nextel Communications

(NXTL)

was rising 4% to $16.90 after the biggest independent U.S. mobile-phone operator posted a wider-than-expected first-quarter loss. It said it would cut 5% of its workers. Nextel reported a loss of $428 million, or 56 cents a share, compared with a year-earlier loss of $435 million, or 59 cents a share. Analysts on average had expected it to report a loss of 51 cents a share.

Nextel wasn't the only company announcing job reductions.

Dow Chemical

(DOW) - Get Report

this morning said it plans to cut 4,500 jobs, or about 8% of its workforce, in a bid to hit $1.1 billion in savings by the end of the first quarter of 2003. The second-largest chemical company is taking over

Union Carbide

. Dow Chemical was lately adding 2.1% to $34.16.

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