Wall Street Cheers Stocks' Resilience as Gains Continue

Most major indices are on the plus side despite the recent strong run-up, as the focus shifts to earnings.
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Wall Street was just as impressed with stocks for edging higher at midday as it was with the big rally they put on after yesterday's



Easy to see why: In three days, the

S&P 500

goes up 4.4%, and on the fourth it's still finding strength. Even when the first of the big economic reports between now and the next

Federal Open Market Committee

meeting came in strong. Despite a bond market that's busy taking back all of yesterday's gains. That's the kind of market that Wall Street could fall in love with all over again.

It's as much about earnings as it is about the Fed. Sure, people will talk your ear off about how stocks are up today because the Fed signaled that it won't raise rates when it meets in late August. "One and done!" they'll shout. "Just a flu shot!" they'll exclaim. Never mind that most Fed watchers

haven't changed their takes on what will happen at the next meeting. Never mind that the bond market is selling off on a

Purchasing Managers' Index

that suggests the Fed may have to go.

What really matters is that the meeting's not going to happen until August, and August is


away. But earnings -- earnings are going to start coming out next week. And earnings look pretty damn good.

"Bonds aren't really responding well today," said Barbara Marcin, portfolio manager at

Gabelli Asset Management

, "but earnings look like they're coming in strong for the quarter. If we shake off concerns about interest rates and focus on earnings, then I guess we could have a strong summer."

That's a bet that investors are making today. The

Dow Jones Industrial Average

was up 25 to 10,996 while the

S&P 500

was up 2 to 1374. The

Nasdaq Composite Index

was up 8 to 2694.

TheStreet.com Internet Sector

index was up 17, or 2.7%, to 634.


Russell 2000

was trading down 4 to 454 -- typical action on the day after the small-cap index was rebalanced, as investors who had been front-running the stocks that index funds would have to load up on sell their shares.

Market internals were positive. There were 72 new highs vs. 21 new lows on the

New York Stock Exchange

, where advancers were outpacing decliners 1,511 to 1,397. In

Nasdaq Stock Market

action, there were 137 new highs and just 18 new lows, but losers were topping gainers 1,891 to 1,746.

Volume was back, suggesting that the buyers' strike is over. On the NYSE, 466 million shares had passed hands. On the Nasdaq, 627 million shares had traded.

Those stats, combined with the recent move up, make technicians happy.

"We're back in the saddle on the upside," said Robert Dickey, managing director of technical analysis at

Dain Rauscher Wessels

in Minneapolis. "The reaction to the Fed announcement and the break through 10,900 is really good. For the next two or three weeks, we're going to be heading higher. We're pretty strong up to 11,400 on the Dow. I think the Nasdaq will perform even better than that. And the Russell even better than that."

Thursday's Midday Movers

By Heather Moore
Staff Reporter

Members of

Lehman Brothers'


"10 Uncommon Values" stock list were benefiting solidly from being anointed as such. (


looked at the absence of traditional value names on the list of values in an earlier


  • America Online (AOL) was up 4 1/8 to 114 1/8.
  • AT&T (T) - Get Report was up 1 13/16 to 57 5/8.
  • Firstar (FSR) was up 15/16 to 28 15/16.
  • Ford (F) - Get Report was up 1 3/8 to 57 13/16.
  • General Instrument (GIC) was up 1 5/8 to 44 1/8.
  • Intel (INTC) - Get Report was up 1 7/8 to 61 1/2.
  • KLA-Tencor (KLAC) - Get Report was up 5 1/8, or 7.9%, to 69 15/16.
  • Eli Lilly (LLY) - Get Report was up 2 5/16 to 73 15/16.
  • Microsoft (MSFT) - Get Report was up 3/16 to 90 1/2.
  • Tyco International (TYC) was up 1 1/8 to 95 7/8.

Commerce One


, an e-commerce software firm, was flying 42 7/8, or 204.1%, to 65 1/16 after

Credit Suisse First Boston

priced its 3.3 million-share IPO above-range at $21.

Among other new issues,



was climbing 12 3/8, or 82.5%, to 27 1/2 after Credit Suisse First Boston priced its 4 million-share IPO top-range at $15. The telecommunications software company is based in Redwood City, Calif.


Salem Communications

(SALM) - Get Report

was hopping up 4 3/8, or 19.4%, to 27 after

Deutsche Banc Alex. Brown

priced its 8.4 million-share IPO above-range at $22.50. The company is a religious and family radio operator.

In other news:



was storming up 6 1/4, or 83.3%, to 13 13/16 after forming a strategic alliance to be


(WMT) - Get Report

exclusive provider of books and related products. Wal-Mart was flat at 48 1/4.


(CNET) - Get Report

was down 5 5/16, or 9.2%, to 52 1/4 after Deutsche Banc Alex. Brown said the company is planning to spend $100 million over the next 18 months to build brand awareness. The firm cut its 1999 estimate for the company to a loss of 50 cents a share from a profit of 20 cents.


(DIS) - Get Report

was off 1 7/16 to 29 3/8 after

Morgan Stanley Dean Witter

downgraded the stock to neutral from strong buy, citing weakness in the company's creative content business.

First Busey

(BUSE) - Get Report

was down 4 3/16, or 16.2%, to 21 11/16 after last night agreeing to acquire

Eagle BancGroup


for $26.6 million, or $25.74 a share, in cash. Eagle BancGroup was up 2 5/16, or 10.5%, to 24 3/8.

Hearst-Argyle Television


was up 1 1/4, or 5.2%, to 25 1/4 after last night saying it will issue about $100 million in new stock to its majority shareholder, Hearst, to raise cash for trimming debt.



was up 5 15/16 to 178 1/8 after expanding its marketing relationship with

Procter & Gamble

(PG) - Get Report

. P&G was down 3 to 86 1/4.

Earnings/revenue movers

Herman Miller

(MLHR) - Get Report

was up 2 1/4, or 10.8%, to 23 1/4 after last night posting fourth-quarter earnings of 48 cents a share, topping both the seven-analyst outlook for 37 cents and the year-ago 40 cents.


(NKE) - Get Report

was down 3 to 60 3/8 even after last night posting fourth-quarter earnings of 38 cents a share, a penny higher than the 16-analyst outlook and above the year-ago 4 cents. The retailer said it sees 2000 percentage revenue growth in the mid-single digits.



was up 2 1/16, or 22.8%, to 11 3/16 after saying it expects to beat second-quarter estimates by 15 cents to 20 cents a share thanks to design agreements with big computer makers. The three-analyst view called for a loss of 20 cents vs. the year-ago loss of 23 cents.


(SBUX) - Get Report

was tanking 11 1/4, or 30.1%, to 26 3/16 after last night predicting fiscal 1999 earnings of 54 cents a share, below the 20-analyst forecast of 60 cents but above the year-ago 44 cents. The company, blaming slower than anticipated growth and costs from its Internet launch, said it expects the 6-cent shortfall to be evenly split between the last two quarters of the year. Today, Deutsche Banc Alex. Brown dropped the stock to buy from strong buy,

Goldman Sachs

lowered it to market outperformer from recommended,


slashed it to hold from strong buy and

Thomas Weisel Partners

cut it to buy from strong buy.