Updated from 4:07 p.m. EDT
had another solid session Thursday as technology earnings and upgrades convinced buyers to hold their ground. Blue-chips finished a touch higher, amid positive guidance from
Procter & Gamble
and optimistic data on the economy.
Dow Jones Industrial Average
rose 19.44 points, or 0.2%, to 9587.90. The Nasdaq gained 16.08 points, or 0.9%, to 1868.98, and the
closed up 1.70 points, or 0.2%, to 1027.97.
"The market is acting well," said Todd Leone, a trader at SG Cowen. "That said, I think we are getting a little bit top-heavy, especially in technology. We could see a 5% to 10% selloff on the Nasdaq."
Treasuries were higher, with the 10-year note up 22/32 to 97 31/32, yielding 4.50%, despite optimism about the economy. Yields have risen sharply amid expectations for a recovery, but have been settling down from high levels. The government will release key statistics on the job market on Friday.
Tech stocks got a boost Thursday afternoon, as
reported a jump in first-quarter earnings. The company earned $29.7 million, or 15 cents a share, compared to $1.3 million, or 1 cent a share, a year ago. Shares added $3.17, or 11%, to $31.99. The Philadelphia Stock Exchange Semiconductor Index rose 2.5%.
The Nasdaq finished higher for the seventh session in a row for the first time since February 2000. The tech index is up about 40% so far this year, and is at its best level since April 2002.
Meanwhile, the Dow notched its fifth day of gains. The blue-chip index has tacked on approximately 170 points in the past three sessions, and is keeping steady at its best level in almost 15 months.
The broader S&P 500 index moved up for an eighth day in a row, and is up about 17% in 2003.
About 1.45 billion shares traded on the
New York Stock Exchange
, while nearly 1.9 billion shares changed hands on the Nasdaq.
Rob Arancio, head of Nasdaq stock trading at Lehman Brothers, said he thinks the rally may be overextended. "Until financial stocks start to outperform, the gains are vulnerable," he said. The Philadelphia Stock Exchange/BKW Bank Index edged down 0.6%.
On the economic front, first-time jobless claims rose to 413,000 in the latest week, up from a revised 398,000. The indicator tends to show jitters when it crosses above 400,000. The number is being treated as more preliminary than usual, however, due to the shortened Labor Day holiday week.
Meanwhile, the Institute for Supply Management's gauge of the service economy came in above expectations. The index remained steady at a record high level of 65.1 in August.
"The message from the report is that activity in the nonmanufacturing sector of the economy is very strong," wrote Jay Nazareth, an economist at J.P. Morgan, in a research note.
Factory orders rose 1.6% in July to $329.39 billion, up from a revised 1.9% gain the previous month. The government also revised its annual productivity estimate to 6.8% from a previous 5.7%.
Procter & Gamble lifted its sales and earnings expectations for its fiscal first quarter, saying that product volume has been strong. The stock advanced $2.63, or 3%, to $91.43.
Goldman Sachs raised
to outperform from in-line, citing "near-term traction" and the likelihood of stronger government spending. The brokerage noted Wednesday's comments from CEO John Chambers that August results are currently ahead of plan. Cisco gained 37 cents, or 1.8%, to $20.59.
Shares of other networkers, including
, also climbed.
Several other brokerages were out with positive technology research. UBS Warburg upgraded a group of semiconductor-equipment makers, including
to buy, saying existing earnings estimates may be too low, and also raised
Check Point Software
to buy on grounds that the recent series of computer virus attacks is a positive for the stock.
reported a 6.9% rise in August same-store sales, thanks to a sizzling back-to-school season, easily beating the high end of the guidance it gave just two weeks ago. The company said overall sales jumped 13.7% to $19.5 billion in the month. Shares finished up only 17 cents at $60.08, however.
Besides Wal-Mart, the nation's retailers reported mixed August sales results Thursday.
Pier 1 Imports
said same-store sales plunged 6% in the month. It also lowered quarterly revenue guidance. Shares sunk $1.93, or 9%, to $19.08.
said same-store sales jumped a better-than-expected 15.6% in the month, and raised its third-quarter earnings guidance by a penny per share.
said same-store sales dipped 0.8%, while
said comps were up 3.9%.
Among other retailers,
said same-store sales inched up 1%, but were below expectations.
American Eagle Outfitters'
comps sank 10.4%, while
May Department Stores'
results came in 3.2% lower.
were higher by 70 cents, or 3.1%, to $23.39 after it reportedly said at a presentation in New York that U.S. sales "continued to improve" in August.
Companies providing negative earnings guidance included
, which lowered its 2003 estimates. The company now forecasts earnings of 70 cents a share, compared to previous predictions of 86 cents a share. The stock closed down 28 cents, or 1%, to $30.60.
said third-quarter earnings would fall short of forecasts. The company expects a profit of 45 to 47 cents a share, compared to estimates of 49 cents, according to Thomson First Call. Still, the company maintained its guidance for the full year. Shares fell 48 cents, or 1.6%, to $29.37.
The FTSE closed down 0.3% to 4248.8 in London, while Germany's Xetra DAX ended up 0.6% to 3669. In Asia, Japan's Nikkei lost 0.7% to 10,647, while Hong Kong's Hang Seng gained 0.3% to 11,139.