Stocks Close Higher as FOMC Leaves Rates Unchanged

The market rebounded after Tuesday's fall.
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Stocks bounced back after yesterday's selloff and closed solidly higher as oil service and some online brokerage stocks soared, while as expected, the

Federal Open Market Committee

left interest rates unchanged.

The

Dow Jones Industrial Average

surged 92.69, or 1%, to 9366.81. The

S&P 500

added 10.02, or 0.8%, to 1272.01. The

Nasdaq Composite Index

advanced 29.74, or 1.2%, to 2493.16. The small-cap

Russell 2000

gained 2, or 0.7%, to 423.73.

TheStreet.com Internet Sector

index surged 15.48, or 2.9%, to 548.92.

The

Philadelphia Stock Exchange Oil Service Index

skyrocketed 7.1%.

Online brokers

Ameritrade

(AMTD) - Get Report

,

National Discount Brokers

(NDB)

and

Siebert Financial

(SIEB) - Get Report

, for example, soared. Ameritrade was up 18 1/16, or 16.4%, to 128 9/16; National Discount Brokers was up 10 5/8, or 39.4%, to 37 5/8; while Siebert was up 23 1/2, or 90.4%, to 49 1/2.

Meanwhile, securities and credit card giant

Morgan Stanley Dean Witter

(MWD)

surged on speculation of a takeover bid from banking titan

Chase

(CMB)

. However, the stock lost steam after

CNBC

reported this afternoon that the rumors surrounding Morgan Stanley were not true. It was up 2 1/4 to 91 5/8, off its session high of 95. Chase rose 2 7/16 to 79 1/4.

Elsewhere,

Perot Systems

(PER) - Get Report

turned in another fine performance after yesterday's sparkling trading debut. It leapt 17 3/4, or 40.8%, to 61 1/4.

The 30-year Treasury bond fell again. It was down 11/32 to 99 27/32, yielding 5.26%.

On the

New York Stock Exchange

, advancers beat decliners 1,622 to 1,374 on 874 million shares. On the

Nasdaq Stock Market

winners beat losers 1,946 to 1,892 on 824 million shares.

On the NYSE, 68 issues set new 52-week lows while 50 touched new highs. On the Nasdaq, 95 issues set new highs while new lows totaled 52.

On the Big Board,

Advanced Micro Devices

(AMD) - Get Report

was most active, with 12.7 million shares changing hands. It tumbled 3 13/16, or 13.9%, to 20 15/16 after it cancelled two upcoming conference appearances, one at the

NationsBanc Montgomery Securities Technology Week '99

conference in San Francisco and one next week at a

Goldman Sachs

conference. The company didn't give a reason for the cancellations.

On the Nasdaq,

3Com

(COMS)

was most active, with 38.5 million shares changing hands. It was down 6 13/16, or 15.4%, to 37 3/8.

Market data above are preliminary. Updated numbers and analysis will follow in the Market Roundup

.

2:56 p.m.: Stocks Trading at Session Highs

The

Dow Jones Industrial Average

and

S&P 500

were at their session highs in the wake of the as-expected news that the

Federal Open Market Committee

decided to leave interest rates unchanged.

Meanwhile,

E*Trade

(EGRP)

said its online trading function is out of service again,

CNBC

reported. The stock was down 3 5/16, or 5%, to 55 1/4.

Most of the major market gauges soared to their session highs ahead of the news that the FOMC left interest rates unchanged, and then sold off after the announcement, sending the indices off their highs. However, around 2:25 p.m. EST, the Dow and S&P 500 made another push and set new intraday highs.

The Dow was up 112 to 9386.

The S&P 500 was up 12 to 1274. The

Nasdaq Composite Index

up 20 to 2483. The

Russell 2000

was up fractionally at 422.

TheStreet.com Internet Sector

index was up 13 to 547.

The 30-year Treasury bond was down 2/32 to 100 5/32, yielding 5.23%.

Investors didn't like the news that

Advanced Micro Devices

(AMD) - Get Report

has cancelled two upcoming conference appearances, one at the

NationsBanc Montgomery Securities Technology Week '99

conference in San Francisco and one next week at a

Goldman Sachs

conference. AMD was down 2 13/16, or 12%, to 21 1/2. No reason was given for the cancellation.

Brokerage and oil service stocks were surging. The

American Stock Exchange Broker/Dealer Index

jumped 3%.

Morgan Stanley Dean Witter

(MWD)

was up 4 3/8, or 5%, to 93 3/4, on speculation of a takeover bid from banking big

Chase

(CMB)

. Chase, meanwhile, was up 2 3/8 to 79 3/16. It hit a 52-week intraday high of 79 7/16.

Oil service stocks were flying. The

Philadelphia Stock Exchange Oil Service Index

skyrocketed 7%.

On the

New York Stock Exchange

, advancers were beating decliners 1,523 to 1,363 on 682 million shares. On the

Nasdaq Stock Market

winners were beating losers 1,946 to 1,892 on 824 million shares.

On the NYSE, 62 issues had set new 52-week lows while 42 had touched new highs. On the Nasdaq, 77 issues had set new highs while new lows totaled 49.

On the Big Board,

FirstEnergy

(FE) - Get Report

was most active, with 10 million shares changing hands. It was up 5/8 to 30 7/16.

On the Nasdaq,

3Com

(COMS)

was most active with 31 million shares changing hands. It was down 6 13/16, or 16%, to 37 1/4.

1:59 p.m.: Stocks Climb into Positive Territory

The

Dow Jones Industrial Average

and the

Nasdaq Composite Index

were leading the market higher, albeit with only modest gains, while brokerage and oil service stocks surged sharply.

The Dow was up 41 to 9316. The Nasdaq Comp was up 10 to 2473.

Meanwhile, the

American Stock Exchange Broker/Dealer Index

jumped 3%. Broker index component

Morgan Stanley Dean Witter

(MWD)

was up 3 to 92 3/8 on speculation of a takeover bid from banking Goliath

Chase

(CMB)

. Earlier, Morgan Stanley had risen as high as 95. Chase, meanwhile, was up 1/4 to 77 1/16.

Oil service stocks were flying. The

Philadelphia Stock Exchange Oil Service Index

skyrocketed 7%.

Meanwhile, the results of the two-day gathering of the

Federal Open Market Committee

is slated for release around 2:15 p.m. EST. No change in short-term interest rates is expected.

The

S&P 500

was up 2 to 1264. The

Russell 2000

was up fractionally at 422.

TheStreet.com Internet Sector

index was up 9 to 543.

Meanwhile, most online brokerage outfits were sharply higher with the notable exception of

E*Trade

(EGRP)

, which was down 1 7/8 to 56 9/16. E*Trade's trading system suffered an outage for a while today before coming back online.

E*Trade's competitors, meanwhile, soared.

Ameritrade

(AMTD) - Get Report

,

National Discount Brokers

(NDB)

and

Siebert Financial

(SIEB) - Get Report

soared. Ameritrade was up 12 3/16, or 12%, to 123 3/8; National Discount Brokers was up 7 1/16, or 26%, to 34 1/16; while Siebert was up 17 1/8, or 66%, to 43 7/16.

The 30-year Treasury bond was up 3/32 to 100 9/32, yielding 5.23%.

Market internals were positive, but less than robust.

On the

New York Stock Exchange

, advancers were beating decliners 1,414 to 1,393 on 542 million shares. On the

Nasdaq Stock Market

winners were beating losers 1,883 to 1,845 on 692 million shares.

On the NYSE, 58 issues had set new 52-week lows while 34 had touched new highs. On the Nasdaq, 69 issues had set new highs while new lows totaled 45.

On the Big Board,

FirstEnergy

(FE) - Get Report

, was most active, with 9 million shares changing hands. It was up 3/16 to 30.

On the Nasdaq,

3Com

(COMS)

was most active with 26 million shares changing hands. It was down 5 5/8, or 13%, to 38 1/2.

Sector Focus: Auto Makers

Auto makers this week have posted strong U.S. sales figures for the month of January. Today,

General Motors

(GM) - Get Report

continued the good news. GM, the world's largest auto maker, reported January sales of 311,043 vehicles in the U.S., a 4% increase over the year-ago period. Strong sales of mid-size cars, mid-size vans and Chevrolet's new

Silverado

pickup fed the volume boost, the company said. GM, however, fell 13/16 to 88 9/16.

Yesterday,

Ford

(F) - Get Report

said January U.S. vehicle sales jumped 8%. German-American auto giant

DaimlerChrysler

(DCX)

said U.S. sales jumped 14%.

Ford was down 1/16 to 58 15/16, while DaimlerChrysler slumped 7/8 to 102.

12:58 p.m.: Midday Musings: Big-Cap Issues Lead a Marked Market Recovery

12:02 p.m.: Stocks Turn Mixed at Midday

The major market averages were narrowly mixed while online brokerage stocks were flying.

The

Dow Jones Industrial Average

was up 14 to 9289. The

S&P 500

was down fractionally at 1262. The

Nasdaq Composite Index

was up 11 to 2474. The

Russell 2000

was down fractionally at 421.

TheStreet.com Internet Sector

was up 8 to 542.

Continued optimism over the online brokerage business has sent the stocks of those companies soaring.

Ameritrade

(AMTD) - Get Report

was up 13 1/4, or 12%, to 123 1/2, while

National Discount Brokers

(NDB)

was up 10, or 39%, to 37.

Siebert Financial

(SIEB) - Get Report

was up 22 5/16, or 85%, to 48, the largest gainer in value on the

Nasdaq Stock Market

. Siebert closed last Wednesday at 10 11/16.

In the Treasury market, the 30-year bond was down 1/32 to 100 5/32, yielding 5.24%. (For more on the fixed-income market, see today's early

Bond Focus.)

Perot Systems

(PER) - Get Report

, which made a sparkling trading debut yesterday, was surging again today. It was up 14 1/8, or 32%, to 57 5/8.

On the

New York Stock Exchange

, decliners were beating advancers 1,341 to 1,391 on 341 million shares. On the Nasdaq losers were beating winners 1,768 to 1,639 on 471 million shares.

On the NYSE, 40 issues had set new 52-week lows while 26 had touched new highs. On the Nasdaq, 58 issues had set new highs while new lows totaled 33.

On the Big Board,

FirstEnergy

(FE) - Get Report

was most active, with 5 million shares changing hands. It was up 15 1/2 to 59.

On the Nasdaq,

3Com

(COMS)

was most active, with 19 million shares changing hands. It was down 4 13/16, or 11%, to 39 5/16.

Tech Focus

Among the tech indices, the

Philadelphia Stock Exchange Computer Box Maker Index

was up 1%. The

Morgan Stanley High-Tech 35

was up fractionally. The

Nasdaq 100

was up 1%.

The

Philadelphia Stock Exchange Semiconductor Index

was up 2%.

News from cyberspace has been prominent today.

America Online

(AOL)

and

Bank One's

(ONE) - Get Report

First USA

unit, the nation's largest issuer of

Visa

and

Mastercard

credit cards, set a five-year agreement that the companies say represents the Internet's largest advertising-and-marketing partnership to date. The agreement makes First USA the exclusive marketer of credit card products and services on AOL in the U.S. and Canada. AOL was up 3 5/16 to 170 15/16, while Bank One slipped 5/16 to 49 1/4.

Gateway

(GTW)

and Internet services giant

Yahoo!

(YHOO)

will launch a co-branded service Friday. Gateway was up 1 1/4 to 79 3/4, while Yahoo! was up 12 1/8 to 335 3/8.

On the earnings front,

this morning

Qwest

(QWST)

posted fourth-quarter earnings of 3 cents a share, before charges, beating the

First Call

17-analyst estimate by a penny, but down from the year-ago 6 cents. The company's stock was up 1 5/16 to 61 1/2.

Yesterday,

Cisco

(CSCO) - Get Report

posted earnings that beat Wall Street expectations. However, with no news of a stock split forthcoming, the stock has sold off. It was down 5/8 to 111 13/16.

In other tech news,

Credit Suisse First Boston

upped its 12-month price target on

Oracle

(ORCL) - Get Report

to $67 a share from the current $45 a share. Oracle was up 3/4 to 59 5/8.

Broadcast.com

said it will be the exclusive Internet broadcaster for all radio stations owned by

Susquehanna Radio

. Broadcast.com was up 3 1/16 to 145 11/16.

IBM

(IBM) - Get Report

announced the availability of a new talking Web browser for blind and visually impaired computer users. The new software, called

Home Page Reader for Windows

, provides Internet access by speaking aloud the information found on a Web site. The new software, available in English, joins the original Japanese version of the product. IBM also said it intends to translate the software into other languages this year. IBM was down 2 15/16 to 173 13/16.

11:01 a.m.: Stocks Little Changed Ahead of Fed Announcement

The market's major indices, after shaking off early weakness and rising, lost steam and have since fallen slightly in the red.

Peter Cardillo, chief strategist at

Westfalia Investments

, said the market is basically on hold until midafternoon when the results of the

Federal Open Market Committee

are announced. The FOMC meeting began yesterday.

"The market's not expecting it to do anything," he said of the FOMC. He said that until the results are known, the market will probably go through a swing day -- up, down, up, down -- with maybe some firming up after the announcement this afternoon.

"Basically we're OK," he said of the market right now.

The

Dow Jones Industrial Average

was down 11 to 9263. The best performing member of the Dow was

Goodyear

(GT) - Get Report

, which was up 1 3/4 to 52 1/8. This morning, Goodyear and Japanese concern

Sumitomo Rubber Industries

announced a global alliance. As part of the linkup, the companies will form four joint venture operating companies, with one based in North America, one in Europe and two in Japan.

Cardillo said the Goodyear news was encouraging. He said corporate America and corporations around the globe are realizing the need to join forces going forward.

The

S&P 500

was down 3 to 1259.

The

Nasdaq Composite Index

was down fractionally at 2463. The

Russell 2000

was down 1 to 421.

TheStreet.com Internet Sector

index was up 6 to 540.

Yahoo!

(YHOO)

was the biggest gainer in terms of value in the index, up 7 7/8 to 331 1/4.

The 30-year Treasury bond was down 3/32 to 100 4/32, yielding 5.24%

On the

New York Stock Exchange

, decliners were edging advancers 1,308 to 1,177 on 219 million shares. On the

Nasdaq Stock Market

, losers were beating winners 1,593 to 1,461 on 312 million shares.

On the NYSE, 31 issues had set new 52-week lows while 20 had touched new highs. On the Nasdaq, 41 issues had set new highs while new lows totaled 22.

On the Big Board,

Compaq

(CPQ)

was most active, with 4 million shares changing hands. It was down 1/8 to 47 5/16.

On the Nasdaq,

3Com

(COMS)

was most active, with 16 million shares changing hands. It was down 4 3/8, or 10%, to 39 3/4.

9:54 a.m.: Internet Issues Climb at Open

Stocks fell slightly early on while Internet stocks rose.

The

S&P 500

was down 2 to 1260. The

Nasdaq Composite Index

was up 1 to 2465. The

Dow Jones Industrial Average

was down 1 to 9273. The

Russell 2000

was down 1 to 421.

TheStreet.com Internet Sector

was up 11 to 545.

The 30-year Treasury bond was down 4/32 to 100 3/32, yielding 5.25%.

Most Up at Open -- NYSE

Eastman Kodak (EK) , up 1 1/2 to 67 3/8

:

Credit Suisse First Boston

raised its rating on Eastman Kodak to strong buy from buy.

Most Up at Open -- Nasdaq

Business Objects (BOBJY) , up 4 3/4 to 36 1/2

:

BT Alex. Brown

upgraded the stock to strong buy from buy. Yesterday Business Objects posted fourth-quarter earnings that exceeded Wall Street expectations.

Most Down at Open -- NYSE

Telebras (TBH) , down 2 1/2 to 72 1/2

.

Most Down at Open -- Nasdaq

Tekelec (TKLC) , down 6 3/4 to 13 1/4

: The company posted fourth-quarter proforma earnings, excluding items, of 16 cents a share, 3 cents shy of the five-analyst

First Call

view, but up from the year-ago 15 cents.