We've got breadth. We've got earnings. We've got lower rates -- who could ask for anything more? Who could ask for anything more!
Dow Jones Industrial Average
, at least today, reminded everyone how far a little bit of strong earnings indications (remember those?) can take an average. The Dow closed up 253.16 to 11,119.86, closing above 11,000 for the first time since Feb. 3, led by
, which helped pull the
Nasdaq Composite Index
to an impressive rise of 75.94, or 1.6%, to 4940.69.
advanced smartly, finishing up 26.71, or 1.8%, to a record 1527.35.
"It was another bull session across the board," said Matt McDermott, a trader at
. "It's basically being attributed to first-quarter outlooks that are pretty good. "
Translation: It's all about GE. The stock surged again today after a
upgrade. The company's been a tank this week, after saying two days ago that it expects to exceed first-quarter estimates, and it rose 8 5/8 to 159 1/2 today, contributing 42 points to the Dow's gain.
rose 9, or 8.7%, to 111 7/8 after
The Wall Street Journal
reported this morning that the company was reportedly moving closer to a settlement in its federal antitrust case. (
joint newsroom wrote a
story on this earlier.)
But Microsoft's news is germane mostly to that stock. The continued strength in GE as a stock and as a company, amid the
efforts to slow the economy and a full year of higher interest rates, has positive implications for the broader market, because the company has its hands in many pies.
"Frankly, GE in a lot of ways
the market," said Mike Vogelzang, president and CIO at
, a subsidiary of
. "When a company with that much exposure to the economic environment says its profits are tracking ahead of plan, well, it's bleeding into everything that's out there."
Include among those groups basic industries, banks and consumer products. And each of those sectors had its own good news today:
Morgan Stanley Dean Witter
reported stronger-than-expected quarterly earnings, pacing that stock and other banks and brokers. That stock rose 5% to 94 3/4.
gained 7 1/16 to 136 1/8,
rose 8 1/8 to 155 7/8 and
gained 5 to 109 15/16.
said its earnings would exceed consensus estimates, and it brushed on an additional 9/16 to 21 15/16.
Preannouncement Season Painless So Far
These positive reports, coming after a number of choppy weeks in the market, are heartening at a time when the market is entering the earnings preannouncement period. That can be a nerve-racking, volatile period, as corporate executives swallow their pride and let the world know why the company accountants have been sobbing themselves to sleep or getting in bar fights.
"We're bracing for a choppy period and it's turning into a good-news period," said Vogelzang.
The overall year-over-year earnings comparison is likely to come out favorably, because the first quarter of 1999 was still a period of suffering for companies coming out from the 1998 emerging-markets crisis. But that doesn't alter the current picture that market participants are garnering of the economy -- that the Federal Reserve, for all its bluster about current stock prices, is focused on incrementally slowing the economy to ward off inflation. Strategists, right or wrong, believe the ballyhooed "soft landing" will be achieved.
"Market participants are convinced that we're looking forward to another soft landing, which is a positive," said Syl Marquardt, research director at
John Hancock Funds
. "The market is correctly sniffing out the end of rate hikes and a slowdown in the next few months, and they're discounting that."
That's partially evidenced in the strength in the banks in recent weeks, which respond favorably to lower interest rates.
, a strong banks that rebounded easily from the late-February decline in financial stocks, reached a new closing high today, up 6 15/16 to 98 1/2. The
Philadelphia Stock Exchange/KBW Bank Index
closed up 4% today, gaining 17% during the last month.
rose 5 1/4 to 87 today, partially motivated by a
news report indicating that
would attempt to buy the company -- yes, buy the whole company, as a way to get GM's
unit. News Corp., which lost 1 3/4, denied the report.
New York Stock Exchange's
most active was
, which finished the day down 3 to 29 1/4 on 54 million shares.
Among the Nasdaq's other leaders were the big-cap technology names, including
, which was the
Nasdaq Stock Market's
most active, added 5 15/16 to 77 13/16 on 76.8 million shares;
, which rose to a new closing high today of 86 7/8, a 3 1/8 gain, and
, which gained 1 1/16 to 97 13/16.
Telecommunications names were also stronger, led by
, up 5 3/16 to 159 1/16 and
Level 3 Communications
, rising 4 7/8 to 110 7/8.
Not All Upside
It was a lousy day for a couple of the Nasdaq's most prominent sectors. Biotechnology and semiconductors were stuck in a rut for the duration.
Philadelphia Stock Exchange Semiconductor Index
finished down 1.5%.
Nasdaq Biotechnology Index
Protein Design Labs
continues to trade like a company that hasn't been eating enough of them, losing 8%;
lost 4 3/16 to 57 11/16.
The Internet lost its mojo late in the day, with bellwethers such as
finishing down 5 7/16 to 191.
TheStreet.com Internet Sector
index lost 17.39 to 1253.27. The
, meanwhile, rose 2.6 to 573.79.
Dow Jones Transportation Average
rose 69.11 to 2720.76, while the
Dow Jones Utilities Average
gained 1.94 to 288.95.
The Treasury market was rocked on words from Treasury Undersecretary Gary Gensler, who told a Congressional committee that so-called agency debt's line of credit is largely "symbolic." While bonds of
fell, the benchmark 10-year Treasury bond rallied, gaining 9/32 to 103 2/32 to yield 6.082%. The 30-year bond rose 22/32 to 104 22/32, to yield 5.914%. (For more on the fixed-income market, see today's
Bond Focus .)
Breadth was strong on heavy volume.
New York Stock Exchange
: 1,830 advancers, 1,157 decliners, 1.06 billion shares. 99 new highs, 34 new lows.
Nasdaq Stock Market
: 2,179 advancers, 2,062 decliners, 1.68 billion shares. 109 new highs, 63 new lows.
For a look at more stocks in the news, see the Company Report, published separately.