Ragged Session Ends With Stocks Higher

Many market players and pundits asked to explain the action today resorted to quoting that great philosopher

Ozzy Osbourne

: "Don't ask me, I don't know."

Perplexing most in the process, stocks rode the crazy train to finish with solid gains despite the bond market's failure to capitalize on a generally benign employment report.

Overcoming an early decline to as low as 10,933.65, the

Dow Jones Industrial Average

closed up 84.77, or 0.8%, to an all-time best 11,031.59. The dramatic final-hour surge evident the past two days failed to materialize. But the index began to move higher around 2 p.m. EDT, perhaps as traders sought to get in front of another 3 p.m. boost on the bond futures' close.

IBM

(IBM) - Get Report

rose 3.8% to an all-time high of 217 1/4 to lead the Dow's rise.

Hewlett-Packard

(HWP)

also was among the Dow's biggest influences as bellwether techs stocks, on the run of late, were the best performers today. However, their Internet counterparts were muffled again.

The

Nasdaq Composite Index

closed up 31.34, or 1.3%, to 2503.62, nearing the high end of the intraday range of 2462.27 to 2507.72.

MCI WorldCom

(WCOM)

,

Sun Microsystems

(SUNW) - Get Report

and

Intel

(INTC) - Get Report

were the best performers among traditional tech bellwethers. The

Nasdaq 100

rose 1.9%.

TheStreet.com Internet Sector

index rose 2.35, or 0.4%, to 614.15 after climbing as high as 629.92 and falling as low as 600.63.

The "Big Three" of

Amazon.com

(AMZN) - Get Report

,

Yahoo!

(YHOO)

and

America Online

(AOL)

each finished in arrears, unable to sustain early strength.

Online brokers were solid gainers, however, after

Lehman Brothers

made some positive comments.

E*Trade

(EGRP)

rose 5.4% while

Ameritrade

(AMTD) - Get Report

gained 5.5%. Brokerage stocks were strong performers overall; the

American Stock Exchange Broker/Dealer Index

rose 3.9%.

Meanwhile, Net IPOs

Adforce

(ADFC:Nasdaq) rose 99.6% and

Media Metrix

(MMXI:Nasdaq) gained 168%, while

NetObjects

(NETO:Nasdaq) climbed a more modest 8.9%.

The

S&P 500

rose 12.95, or 1%, to 1345. The

Russell 2000

gained 2.73, or 0.6%, to 436.11.

The Russell 2000 overcame a tumult in gold stocks, which plummeted along with the price of the metal after the

Bank of England

announced plans to sell up to 125 tons, or 60% of its reserves, by next March. Goldman Sachs downgrade several mining companies after gold fell $7 to $283.70 the ounce. The

Philadelphia Stock Exchange Gold & Silver Index

shed 12.8%. (

TheStreet.com

looked further into the gold market in a

story today.)

Gold was the laggard not only overall, but within commodity and economically sensitive groups as well. The

Morgan Stanley Cyclical Index

rose 0.5% to a record 617.46 while the

Philadelphia Stock Exchange Forest & Paper Products Index

gained 1.2% and the

S&P Value Index

rose 0.9%.

The

American Stock Exchange Oil & Gas Index

rose 1.1% despite a dip in crude prices.

Texaco

(TX) - Get Report

jumped 8.1% after

CNBC

reported rumors of merger talks with

Chevron

(CHV)

, which fell 3%.

In

New York Stock Exchange

trading, 819.1 million shares were exchanged while gainers led losers 1,661 to 1,306. In

Nasdaq Stock Market

activity, 871 million shares were exchanged while gainers led 2,107 to 1,847. New 52-week highs led new lows 87 to 25 on the Big Board and by 64 to 27 in over-the-counter trading.

"It's good to see us hang in there," said Jay Meagrow, vice president of trading at

McDonald

in Cleveland. "I was a little scared this morning after they rallied the futures up to 10 and then they went right back down to 3. It was nice to see it come back late in the day."

The talk among some equity traders is the "bond guys overreacted" to

Fed

Chairman

Alan Greenspan's

speech yesterday, Meagrow said. "The equity market had a bit more of a level head. But we'll be economic-release focused for another three weeks."

Heading out for the weekend, the trader said he needed a rest after a busy two weeks. "It's encouraging we're involved in these kind of rallies," he said. "It used to be the upper-tier midsized firms didn't get much of the action; now midcaps are more involved. It's a broader move here."

Morning Squeeze Leaves Juice for Stocks

There was a "big squeeze" this morning in the bond and equity futures markets as players anticipating a robust jobs report were forced to cover, said Jim Volk, co-director of institutional trading at

D.A. Davidson

in Portland, Ore. "The

S&P futures went from flat to plus 1000, then back to 700. Bonds went from minus 2 or 3 ticks to plus 28 then back to plus 12. Then you blinked and it all went negative.

"All these guys came in, covered and walked away," Volk continued. "Then markets started trading on their own. You've got a heavy calendar next week and Greenspan's comments still weighing on bonds, but it hasn't really effected equities."

The traded noted there's still plenty of money to be put to work in equities such as

QLogic

(QLGC)

, up 18.6% after a better-than-expected earnings report.

Emulex

(EMLX)

rose 22.7% partially in concert and because the company and its underwriters are on a roadshow for a secondary offering, he said.

The price of the 30-year Treasury bond fell 11/32 to 92, its yield climbing to 5.82%, its highest level since May 27. The decline (in price) came although the

Labor Department

reported 234,000 new jobs were created in April just above consensus and fall below rumors yesterday of a headline figure over 300,000. Average hourly earnings rose 0.2%, half as much as expected, while the unemployment rate rose to 4.3% from 4.2% in March, a 29-year low.

Among other indices, the

Dow Jones Transportation Average

rose 7.05, or 0.2%, to 3742.83; the

Dow Jones Utility Average

added 1.17, or 0.4%, to 315.95; and the

American Stock Exchange Composite Index

fell 0.52, or 0.1%, to 787.29.

For the week, the Dow industrials rose 242.55, or 2.2%; the S&P 500 added 9.82, or 0.7%; the Nasdaq Comp shed 39.25, or 1.5%; the Russell 2000 added 3.30, or 0.8%; TheStreet.com Internet index lost 42.11, or 6.4%; the Dow transports rose 95.54, or 2.6%; the Dow utilities gained 4.40, or 1.4%; and the Amex Composite rose 10.32, or 1.3%.

Elsewhere in North American equities today, the

Toronto Stock Exchange 300

slid 30.44, or 0.4%, to 6958.86 and the

Mexican Stock Exchange IPC Index

jumped 161.90, or 2.8%, to a record 5964.37. For the week, the TSE 300 shed 55.84 or 0.8% and the IPC, which took a midweek break for Cinco de Mayo, jumped 549.92, or 9.2%.

Friday's Company Report

By Heather Moore
Staff Reporter

(

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.

)

IBM surged 8 to an all-time high of 217 1/4 after SoundView Technology Group analyst Gary Helmig said the outlook for Big Blue's second-quarter results is very strong and that he may raise earnings estimates. The 21-analyst consensus calls for quarter earnings of $1.75 a share vs. the year-ago $1.50.

In new issues, Media Metrix rocketed 28 1/2, or 168%, to 45 9/16 after

Donaldson Lufkin & Jenrette

priced its 3 million-share IPO top-range at $17 a share. The company measures Internet audiences. Elsewhere, Web advertising and direct marketing company AdForce soared 14 15/16, or 99.6%, to 29 15/16 after

Hambrecht & Quist

priced its 4.5 million-share IPO above-range at $15 a share.

Latitude Communications

(LATD:Nasdaq) climbed 1 3/4, or 14.6%, to 13 13/16 after

Credit Suisse First Boston

priced its 3 million-share IPO top-range at $12 a share. Latitude is a provider of integrated voice and data conferencing solutions. Finally, NetObjects, a Web site software company, hopped 1 1/16, or 8.9%, to 13 after

BT Alex. Brown

priced its 6 million-share IPO mid-range at $12.

Newport News Shipbuilding

(NNS)

shot up 5 3/4, or 21.3%, to 32 3/4 and its merger partner

Avondale Industries

(AVDL) - Get Report

jumped 4 1/4, or 13.4%, to an all-time high of 36 1/16 after

Litton Industries

(LIT) - Get Report

made an unsolicited bid for both companies in a combined deal valued at more than $2 billion. Even after

Morgan Stanley Dean Witter

upgraded it to outperform from neutral, Litton gave up 1 5/8 to 63 1/8. Avondale said Litton is offering $38 a share for the company; Newport News said it's being offered 0.55 of a Litton share for each Newport share. Last month,

General Dynamics

(GD) - Get Report

tried to acquire Newport News but the

Defense Department

rejected the proposal.

Gold names returned recent gains after, as noted above, the Bank of England announced it would sell some reserves.

Newmont Mining

(NEM) - Get Report

fell 3 5/16, or 12.7%, to 22 3/4;

Placer Dome

(PDG)

fell 2 7/16, or 15.6%, to 13 3/16; and

Barrick Gold

(ABX)

fell 2 3/4, or 11.8%, to 20 1/2.

Mergers, acquisitions and joint ventures

Bell Atlantic

(BEL)

rung in 2 5/16 to 58 3/16 after the

Justice Department

approved its $52.8 billion purchase of

GTE

(GTE) - Get Report

. The deal still needs to be reviewed by the

Federal Communications Commission

and state regulators. GTE grew 2 3/4 to 67.

J. Ray McDermott

(JRM)

sprouted 4 3/4, or 15.6%, to 35 1/4 after

McDermott

(MDR) - Get Report

said it will buy the remaining 37% of the company it doesn't already own for $513 million, or $35.62 a share. McDermott lifted 2 5/16, or 8.3%, to 30 1/4.

Earnings/revenue reports and previews

CarrAmerica Realty

(CRE)

picked up 1/8 to 24 7/16 after reporting first-quarter funds from operations of 70 cents a share, 2 cents higher than the 11-analyst view and above the year-ago 62 cents. The company also said it would spin-off its executive suites office unit,

OmniOffices

.

QLogic vaulted 14 1/8, or 18.6%, to an all-time high of 90 1/16 after last night reporting fourth-quarter earnings of 45 cents a share, a nickel ahead of estimates.

Sterling Commerce

(SE) - Get Report

flourished 5 3/4, or 17.4%, to 38 3/4 after late yesterday posting second-quarter earnings of 36 cents a share, in line with the 24-analyst forecast and higher than the year-ago 29 cents. Today,

Warburg Dillon Read

raised the stock to buy from hold with a 12-month price target of 40.

Whole Foods Markets

(WFMI)

expanded 3 15/16, or 10.2%, to 42 5/8 after late yesterday topping second-quarter earnings estimates by a penny with a profit of 43 cents a share. Today,

Piper Jaffray

upped the stock to buy from neutral and

NationsBanc Montgomery Securities

lifted it to buy from hold.

Offerings and stock actions

Emulex advanced 11, or 22.7%, to an all-time high of 59 7/16 on what management attributed to excitement over the company's upcoming 2.1 million-share secondary offering.

Net.B@nk

(NTBK)

dropped 4 1/2 to 165 after filing with the

Securities and Exchange Commission

to sell 3 million shares and $100 million in convertible securities.

Analyst actions

Costco

(COST) - Get Report

shaved off 5/16 to 78 15/16 after Lehman Brothers pushed up the stock to buy from outperform and lifted its price target for the stock to 100 from 95 a share.

E*Trade rose 5 5/8, or 5.4%, to 110 3/8 and Ameritrade rose 5 15/16, or 5.5%, to 113 3/4 after Lehman Brothers started coverage of both stocks with buy ratings. Separately,

Southwest Securities

(SWS)

added 2 1/4 to 53 9/16 after saying it would spend $40 million to expand its online brokerage unit.

Radio One

(ROIA)

, which made its public debut this week, climbed 2 1/4, or 6.5%, to 36 7/8 after

Prudential Securities

started coverage with a strong buy.

Sepracor

(SEPR)

tacked on 11 1/2, or 13.6%, to 96 after Warburg Dillon Read started coverage with a buy and a 12-month price target of 143 a share.

SteriGenics

(STER)

popped up 2 5/8, or 22.3%, to 14 1/2 after

PaineWebber

upped it to buy from attractive.

Sunglass Hut

(RAYS)

leapt 15/16, or 6.7%, to an annual high of 14 15/16 after

Morgan Stanley Dean Witter

raised its 1999 earnings estimate for the company to 55 cents a share from 50 cents and its 2000 view to 75 cents from 70 cents. The firm also increased its price target for the stock to 20 a share from 14.

Miscellany

After

Business Week's

Inside Wall Street column quoted a money manager proclaiming

Bowne

(BNE)

a "fascinating and undervalued stock," the stock excelled 15/16, or 5.6%, to 17 5/8. David Rocker of

Rocker Partners

told the magazine the world's largest financial printer is worth twice its current price thanks the company's new Web services. The column also gave a boost to

Fairfield Communities

(FFD)

, which grew 3/4, or 5.4%, to 14 3/4.

Equity fund

Baker Fentress

(BKF) - Get Report

shot up 3 5/16, or 21.1%, to 19 after late yesterday saying its board approved a plan to sell most of the company's investments and distribute the proceeds to shareholders.

CellNet Data Systems

(CNDS)

surged 1 5/16, or 14.8%, to 10 1/4 after naming John LaMacchia, former chief executive of

Cincinnati Bell

(CSN)

, CEO.

Chevron lost 2 15/16 to 94 7/8 after late yesterday saying it canceled the sale of its 25% stake in three oil platforms in California. Instead, the company will shut down production at the project.