With about an hour left to the trading day, the tech-laden
Nasdaq Composite Index was jumping 3.7% and sending many pockets of the tech world markedly higher.
The Internet sector was helping to lead the gains, reflected by the 7.3% jump in
TheStreet.com Internet Sector
Internet advertising company
was recently 15.9% higher to $15 after the online advertising company announced it had signed a partnership agreement with streaming media company
. iBEAM moved up 28.6%, or 8 cents, to 36 cents.
But not all the gains were pegged to news. Media delivery provider
was up 14.8% to $15.90, for example, and Internet security provider
was tacking on 15.1% to $15.90.
Bob Basel, director of listed trading at
Salomon Smith Barney
, said he sees "a short squeeze" at play in today's tech rally. People who borrowed stocks on the gamble they would go down -- and could be replaced more cheaply -- are being forced to buy today and forcing their price up. It's "shorts throwing in the towel," he said.
recently took a look at the impact
shorts have on the market.
Tech stocks and the general market have been on the trajectory higher since early April, in large part inspired by a belief the recent series of rate cuts from the
Federal Reserve will help fuel an economic recovery.
Doug Myers, vice president of equity trading at
said he saw short squeezes today in some stocks, but didn't think the moves were driving the entire tech rally. Investors today, he said, seem to be "pining for those go-go days of a couple years ago" and throwing their money back into tech stocks.
Chip stocks, which have moved sharply higher since early April, were riding the tech wave. The
Dow Jones U.S. Semiconductor Index
lately gained 4.7%, while the closely watched
Philadelphia Stock Exchange Semiconductor Index
posted a 5.1% rise.
At the front of the semiconductor pack was
, climbing 10.9%, or $4.17, to $42.83.
Applied Micro Circuits
rose 8.6% to $25.52, while
added 7.5% to $28.07.
Several big-name chip companies were rising despite
having their earnings forecasts lowered this morning by
Joe Osha. He cut his earnings targets on
Advanced Micro Devices
The software sector also posted large gains. The
Dow Jones U.S. Software Index
was gaining 4.3%.
was up 14.6% to $27.40, information management software maker
was 15% higher to $21.99 and e-business solution provider
was gaining 12.7% to $27.
jumped 10.7% to $22.35, and the
American Stock Exchange Networking Index
was moving 4.6% higher.
rose 12.5% to $22.42. And the
Philadelphia Stock Exchange Box Maker Index
, made up of computer manufacturers, rose 2.9%.