Stocks Erase Early Losses to Close at Record Highs

The Russell was the only major index that didn't end at a record level.
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What looked like it was going to be a horrid day on Wall Street before the opening bell turned into another session where records fell like

Compaq's

(CPQ)

stock price.

While the market's major gauges posted gains, PC makers and semiconductor stocks were notable on the downside, pressured in part by the Compaq profit warning and a

BancBoston Robertson Stephens

downgrade of

Intel

(INTC) - Get Report

.

TheStreet.com

wrote about Intel

this afternoon. Intel was down 4 1/4, or 6.5%, to 61 3/16.

Compaq after the close

Friday warned it expects first-quarter earnings of 15 cents a share, less than half the 33-analyst

First Call

forecast of 31 cents. Compaq was most active on the

New York Stock Exchange

, with 111 million shares changing hands. It was down 6 7/8, or 22.2%, to 24 1/16.

The

Dow Jones Industrial Average

,

S&P 500

,

Nasdaq Composite Index

and

TheStreet.com Internet Sector

index all closed at record highs.

The small fries turned in an impressive performance. The

Russell 2000

jumped 6.45, or 1.6%, to 412.31.

The Dow hopped 165.67, or 1.6%, to 10,339.51. The S&P 500 advanced 10.29, or 0.8%, to 1358.64. The Nasdaq Comp gained 5.77, or 0.2%, to 2598.82. It had dropped 66 points early on.

Bargain hunters rushed the market after a sharp drop early on and boosted stock prices in a wide variety of sectors, but they couldn't bring themselves to snap up tech stocks. The

Nasdaq 100

slipped 0.6%, while the

Morgan Stanley High-Tech 35

slumped 2.8%. The

Philadelphia Stock Exchange Semiconductor Index

fell 5.4%, while the

Philadelphia Stock Exchange Computer Box Maker Index

swooned 4.2%.

TheStreet.com index leapt 58.44, or 8%, to 790.37, while

TheStreet.com E-Commerce Index

jumped 3.77, or 2.9%, to 135.59.

The 30-year Treasury bond gained 7/32 to 97 2/32, yielding 5.450%.

On the Big Board, advancers beat decliners 1,670 to 1,307 on 810 million shares. On the

Nasdaq Stock Market

, losers beat winners 2,107 to 1,945 on 1.151 billion shares.

On the NYSE, 119 issues set new 52-week highs while 70 touched new lows. On the Nasdaq, 156 issues set new lows while new highs totaled 123.

On the Nasdaq,

Dell

(DELL) - Get Report

was most active, with 42.3 million shares changing hands. It was down 1 3/4 to 41 13/16.

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

3:14 p.m.: Dow, S&P 500, Nasdaq Climb Into Record Territory

After taking a shot to the breadbasket out of the gate after

Compaq's

(CPQ)

profit warning late

Friday, stocks recovered handsomely and were higher going into the final hour of trading.

The Compaq news, however, was still pressuring the tech sector dramatically, as PC makers and semiconductor stocks were getting pounded. However, Internet stocks were soaring.

Meanwhile, the

S&P 500

,

Nasdaq Composite Index

and

Dow Jones Industrial Average

were in record territory.

Compaq was down 6 15/16, or 22%, to 24, and was most active on the

New York Stock Exchange

with 100 million shares changing hands.

"I think it's a good thing it was Compaq and not another stock," said Jay Suskind, head of institutional equity trading at

Ryan Beck

. He said it would've been much worse for the market overall if it was another stock that had warned, say a prominent tech leader like

Microsoft

(MSFT) - Get Report

or

Cisco

(CSCO) - Get Report

, for example.

After the initial opening swoon, a "buy on weakness" sentiment in the market prevailed, Suskind said.

The S&P 500 was up 7 to 1355, while the Dow surged 133 to 10,307. The Nasdaq Composite Index was up 5 to 2598.

The biggest percentage winner so far among the market's major gauges has been the long-suffering small-cap

Russell 2000

, which has jumped 6, or 1%, to 412.

Suskind mentioned that the small- and mid-cap stocks might "start to come out from the rock they've been under."

TheStreet.com Internet Sector

index was up 46 to 778.

TheStreet.com E-Commerce Index

was up 3 to 135.

The 30-year Treasury bond was up 6/32 to 97 2/32, yielding 5.45%, off its best level of the session. On the economic front, tomorrow the March

Consumer Price Index

and the March

retail sales

reports are slated to be released.

On the Big Board, advancers were beating decliners 1,617 to 1,321 on 665 million shares. On the

Nasdaq Stock Market

, losers were beating winners 2,071 to 1,931 on 949 million shares.

On the NYSE, 109 issues had set new 52-week highs while 65 had touched new lows. On the Nasdaq, 143 stocks had set new highs while 105 touched new lows.

On the Nasdaq,

Dell

(DELL) - Get Report

was most active, with 38 million shares changing hands. It was down 1 7/8 to 41 3/4.

2:02 p.m.: Stocks Erase Early Losses Posted on Compaq Warning

An ugly beginning this morning has gradually turned into a radiant afternoon on Wall Street as stocks staged a dramatic rebound and all of the major market barometers were solidly higher.

Meanwhile, Internet stocks were soaring.

After being down as much as about 2.6% early on, the

Nasdaq Composite Index

was now in record territory. The Nasdaq Comp was up 7 to 2600.

The

Dow Jones Industrial Average

was up 120 to 10,294. The

S&P 500

was up 7 to 1355, also in record territory.

The

Russell 2000

was up 6 to 412, outpacing the rest of the market's major averages percentage-wise.

TheStreet.com Internet Sector

index was up 53 to 785.

TheStreet.com E-Commerce Index

was up 4 to 136.

The 30-year Treasury bond was up 15/32 to 97 11/32, yielding 5.43%

On the

New York Stock Exchange

, advancers were beating decliners 1,611 to 1,265 on 544 million shares. On the

Nasdaq Stock Market

, losers were beating winners 2,001 to 1,852 on 779 million shares.

On the NYSE, 95 issues had set new 52-week highs while 55 had touched new lows. On the Nasdaq, 125 issues had set new highs while new lows totaled 91.

On the Big Board,

Compaq

(CPQ)

was most active, with 89 million shares changing hands. It was down 6 15/16, or 22%, to 24. Compaq's profit warning

Friday pressured stocks through much of the morning.

On the Nasdaq,

Dell

(DELL) - Get Report

was most active, with 33 million shares changing hands. It was down 2 1/8 to 41 1/2.

Focus: Gannett, Dow Jones

Gannett

(GCI) - Get Report

posted fourth-quarter earnings of 64 cents a share, beating the 13-analyst estimate by 2 cents. Gannett said its newspaper group posted record operating results for the quarter. Gannett was down, however, off 3/8 to 62 13/16.

Dow Jones

(DJ)

reported first-quarter operating earnings of 44 cents a share, outstripping the nine-analyst estimate of 38 cents. On the news, Dow Jones rose 2 11/16, or 5.6%, to 50 13/16.

1:02 p.m.: Midday Musings: Market Shrugs Off Compaq and Intel With Aplomb

11:55 a.m.: Stocks Remain Mixed After Early Drop on Compaq Warning

Stocks have shaken off a good portion of their early

Compaq

(CPQ)

-induced weakness as the major market averages were mixed late this morning.

The tech-heavy

Nasdaq Composite Index

was still down the most, off 22 to 2571, but well off its worst levels of the session.

The

Dow Jones Industrial Average

was up 18 to 10,192. The biggest boost to the Dow was

American Express

(AXP) - Get Report

, which was up 2 5/8 to 131.

The

S&P 500

was down 5 to 1343. The

Russell 2000

was up fractionally to 406.

TheStreet.com Internet Sector

index was soaring 36 to 758.

TheStreet.com E-Commerce Index

was up 2 to 134.

The 30-year Treasury bond was up 10/32 to 97 5/32, yielding 5.44%.

On the

New York Stock Exchange

, decliners were beating advancers 1,564 to 1,201 on 334 million shares. On the

Nasdaq Stock Market

, losers were beating winners 1,962 to 1,540 on 484 million shares.

On the NYSE, 62 issues had set new 52-week highs while 41 had touched new lows. On the Nasdaq, 92 issues had set new highs while new lows totaled 69.

On the Big Board, Compaq was most active, with 62 million shares changing hands. It was down 6 15/16, or 22%, to 24, in the wake of its profit warning

Friday. Compaq expects first-quarter earnings of 15 cents a share, less than half the 33-analyst

First Call

forecast of 31 cents. Compaq earned 1 cent in the year-ago period.

On the Nasdaq,

Dell

(DELL) - Get Report

was most active, with 27 million shares changing hands. It was down 2 1/4 to 41 3/8.

Tech Focus

The

Nasdaq 100

was down 1%, while the

Morgan Stanley High-Tech 35

was down 3%. The

Philadelphia Stock Exchange Semiconductor Index

was down 5%.

RealNetworks

(RNWK) - Get Report

was flying on news it and

IBM

(IBM) - Get Report

set a pact to develop an application that will enable consumers to receive and process music and related data from the Internet using IBM security features. RealNetworks was up 24 5/8, or 12%, to 232 3/4. IBM, however, was down 4 5/16 to 182.

Intel

(INTC) - Get Report

was down 4 9/16 to 60 15/16, after a downgrade by

BancBoston Robertson Stephens

.

theglobe.com

(TGLO)

said it expects to file with the

Securities and Exchange Commission

to register 4 million common shares, of which 2 million will be offered by the company and 2 million shares will be offered by existing stockholders. theglobe.com was down 8 5/8, or 11%, to 70 1/2.

11:05 a.m.: Stocks Turn Mixed After Early Fall on Compaq Warning

After tumbling sharply early on, stocks managed to bounce off their

Compaq

(CPQ)

profit-warning-triggered lows.

Compaq said after the close on

Friday that it expects first-quarter earnings of 15 cents a share, less than half the 33-analyst

First Call

forecast of 31 cents. Compaq earned 1 cent in the year-ago period. Compaq was down 6 1/2, or 21%, to 24 7/16. It was most active on the

New York Stock Exchange

with 46 million shares changing hands.

The

Dow Jones Industrial Average

was up 5 to 10,179. The

S&P 500

was down 5 to 1343. It bottomed at 1333. The

Nasdaq Composite Index

was down 16 to 2577. The Nasdaq Comp had fallen as much as 66 points at its nadir.

The small-cap

Russell 2000

was up fractionally at 406.

Internet stocks were up significantly.

TheStreet.com Internet Sector

index was up 35 to 767.

RealNetworks

(RNWK) - Get Report

was flying on news it and

IBM

(IBM) - Get Report

set a pact to develop an application that will enable consumers to receive and process music and related data from the Internet using IBM security features. RealNetworks was up 22 1/16, or 11%, to 229 7/16. IBM, however, was down 4 15/16 to 181 3/38.

TheStreet.com E-Commerce Index

was up 3 to 135.

The 30-year Treasury bond was up 10/32 to 97 5/32, yielding 5.44%, off its session highs.

The Compaq warning was pounding PC makers. The

Philadelphia Stock Exchange Computer Box Maker Index

was down 4%. Semiconductor stocks were sharply lower. The

Philadelphia Stock Exchange Semiconductor Index

was down 3%.

Intel

(INTC) - Get Report

was down 3 5/16 to 62 1/8, after a downgrade by

BancBoston Robertson Stephens

. The chip giant is slated to report earnings tomorrow.

On the NYSE, decliners were beating advancers 1,505 to 1,083 on 236 million shares. On the

Nasdaq Stock Market

, losers were leading winners 1,860 to 1,407 on 343 million shares.

On the NYSE, 45 issues had set new 52-week highs while 30 had touched new lows. On the Nasdaq, 68 issues had set new highs while new lows totaled 58.

On the Nasdaq,

Dell

(DELL) - Get Report

was most active, with 23 million shares changing hands. It was down 2 1/8 to 41 1/2.

Company Focus: Unocal

Unocal's

(UCL)

Spirit Energy 76

unit today announced a "very significant" oil and gas discovery in the deepwater Gulf of Mexico.

The discovery, on the Mad Dog prospect, is located about 150 miles south of Venice, La., and was drilled in 5,000 to 7,000 feet of water. It is Unocal's second major find this year in the gulf. Although further testing is necessary, Unocal said the prospect likely contains over 400 million and as much as 800 million barrels of oil equivalent.

Spirit holds a 25% interest in the prospect.

BP Amoco

(BPA)

is the operator; a third partner is Australia's

Broken Hill Proprietary

(BHP) - Get Report

.

TheStreet.com

looked at Unocal in

two stories this morning.

Unocal also said it acquired a 50% working interest from

Conoco

(COC)

in the K2 prospect, just north of Mad Dog. Shares of Unocal were up 1/2 to 36 13/16.

--

Mavis Scanlon

9:55 a.m.: Stocks Tumble After Compaq Profit Warning

Compaq's

(CPQ)

profit warning after the close Friday helped send stocks sharply lower early on.

Blaming weak demand and competitive pricing, Compaq expects first-quarter earnings of 15 cents a share, less than half the 33-analyst

First Call

forecast of 31 cents. Compaq earned 1 cent in the year-ago period.

TheStreet.com

wrote about the debacle on

Friday.

The

Nasdaq Composite Index

was down 56 to 2537. The

Dow Jones Industrial Average

was down 62 to 10,111. The

S&P 500

was down 13 to 1336. The

Russell 2000

was down 5 to 401.

TheStreet.com Internet Sector

index was down 3 to 729.

TheStreet.com E-Commerce Index

was down 3 to 128.

The 30-year Treasury bond was up 12/32 to 97 7/32, yielding 5.44%, thanks to the weakness in stocks.

Most Up at Open -- NYSE

Tanger Factory Outlet (SKT) - Get Report, up 1 3/16 to 22

.

Most Up at Open -- Nasdaq

RealNetworks (RNWK) - Get Report, up 10 1/2 to 218

:

IBM

(IBM) - Get Report

and RealNetworks set a pact to develop an application that will enable consumers to receive and process music and related data from the Internet using IBM security features.

Most Down at Open -- NYSE

Sony (SNE) - Get Report, down 3 13/16 to 99 1/8

.

Most Down at Open -- Nasdaq

Yahoo! (YHOO) , down 13 7/8 to 193 1/8

.