Today's Market: Dow, Nasdaq Return to Green in Midday Action - TheStreet

Stocks have taken a turn to the upside as the major indices were making a solid move into the green.

The

Dow Jones Industrial Average and

Nasdaq Composite Index were mildly higher, with the Dow up 13 to 10,645, and the Comp up 14 to 3704. The Dow started off in positive territory, but fell about half an hour after the opening bell, while the Comp held on a little longer.

"It kind of looks like we're trying to find a bottom. Yesterday was disappointing," said Jim Benning, a trader at

BT Brokerage

. On the upside, he thinks most of the bad news is out of the way, referring to the latest string of high-profile earnings warning in hopes that they are the last. "We probably won't be seeing too many more profit warnings. Most of the warnings

this past week are all you're going to hear," for a while, he said.

Eastman Kodak

(EK)

kept its place as the biggest drag on the Dow, taking about 23 points away from the index. It was followed by

Boeing

(BA) - Get Report

and

Microsoft

(MSFT) - Get Report

, which were both weighing it down.

Boeing was suffering after it was announced that the European Commission cleared Boeing's plans to buy

Hughes Electronics

(GMH)

. Still, Boeing got its daily affirmation in the form of an upgrade in its price target from

SG Cowen

and a raise in its 2000 earnings per share estimate at

Lehman Brothers

.

Good News Is Good

With all of the

earnings warnings in the past couple weeks, it was nice to get some good news from

3Com

(COMS)

. It reported a far narrower-than-expected loss last night, and got some positive revisions on 2001 loss estimates from Lehman Brothers and

Goldman Sachs

. The stock was lately soaring, up 21.5%.

Two of 3Com's primary competitors,

Lucent

(LU)

and

Nortel

(NT)

were falling, down 4.1% and 5%.

Also,

Motorola

(MOT)

was lately falling about 4.2%, on rumors of an earnings shortfall, one trader said.

Meanwhile, the aforementioned Microsoft, along with tech heavyweights

Dell

(DELL) - Get Report

,

eBay

(EBAY) - Get Report

and

Amazon.com

(AMZN) - Get Report

were all trying to pull down the Comp.

They were facing some tough competition, though, from

Cisco

(CSCO) - Get Report

, up 2.9% to $56.88;

Intel

(INTC) - Get Report

, up 2.9% to $44.56; and

Oracle

(ORCL) - Get Report

, up 0.6% to $79.88.

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Market Internals

Breadth was mixed on moderate volume.

New York Stock Exchange: 1,570 advancers, 1,116 decliners, 644 million shares. 66 new 52-week highs, 72 new lows.

Nasdaq Stock Market: 1,702 advancers, 1,961 decliners, 1.03 billion shares. 68 new highs, 152 new lows.

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Most Active Stocks

NYSE Most Actives

  • Southern Energy (SOE) : 27.2 million shares.
  • Nortel (NT) : 19.1 million shares.
  • Motorola: 18.2 million shares.

Nasdaq Most Actives

  • Intel: 50.6 million shares.
  • priceline.com (PCLN) : 32.9 million shares.
  • Cisco: 32.9 million shares.

Sector Watch

Semiconductors were making another attempt at a comeback this morning. The sector has been under water of late on concern that chip demand is slowing. The

Philadelphia Stock Exchange Semiconductor Index

was lately up 3.3%.

Altera

(ALTR) - Get Report

,

Micron

(MU) - Get Report

and

Xilinx

(XLNX) - Get Report

were providing much of the lift.

Brokerage stocks were slipping slightly, and banks and insurance stocks were down this morning following news of

FleetBoston's

(FBF)

planned acquisition. The

American Stock Exchange Broker/Dealer Index

was down 3%, while the

Philadelphia Stock Exchange/KBW Bank Index

was 0.8% lower and the

S&P Insurance Index

was off 0.3%.

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Bonds/Economy

Bonds are under pressure in part because a

report in today's

Washington Post

says an error in calculating the

Consumer Price Index

(

definition |

chart |

source

) resulted in it being understated.

The Bureau of Labor Statistics

confirmed that it will revise CPI data for January to August, and that the increase over that period will be revised to 2.7% from 2.6%. The bureau will release corrected data on Thursday at 10 a.m. EDT.

The

Washington Post

article says the correction is likely to add 0.1 to 0.3 percentage points to the overall and core inflation rates. Overall CPI inflation was running at a rate of 3.4% in August, while core CPI inflation, which excludes food and energy, was running at 2.5%, nearly a two-year high.

A higher inflation rate devalues bonds because it erodes the value of the fixed interest payments they make.

The benchmark 10-year Treasury note lately was down 11/32 at 99 8/32, lifting its yield to 5.850%.

The BLS said the error was in the portion of the report that measures housing costs, and that software was responsible.

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International

Europe's major indices were in the green

today.

In London, the

FTSE 100

rose 56.1 to 6269.3, buoyed by big oils, telecoms and pharmaceuticals.

Across the channel, the

CAC 40

in Paris gained 25.73 to 6319.79, and the

Xetra Dax

in Frankfurt was up 43.31 to 6808.35.

The euro was lately trading at 0.8821.

Asian markets were mixed overnight, with Tokyo tumbling and Hong Kong pulling higher.

Worries over a slowing economic recovery set Japanese shares back once again Wednesday, with the

Nikkei 225

index setting a fresh 18 month low.

The Nikkei 225 index shed 288.67, or 1.8%, to 15,639.95

The greenback barely budged against the yen in Tokyo trading to 107.73. The dollar was lately trading at 107.425 yen.

Hong Kong's

Hang Seng

index gained 153.28, or 1.0%, to 15,444.13 after investors picked up major blue chips as a safe haven vs. volatile technology shares. Property shares were red-hot, including

Sun Hung Kai Properties

(SUHJY)

, up HK$2.00, or 3.0%, to 69.50 ($8.91), and

Cheung Kong

, up 1.00, or 1.1%, to 92.25.

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