Posted on: Wednesday, January 23, 2002

Technology buyers fuel modest Wall Street rally

Associated Press

NEW YORK — Technology buyers set off a modest rally on Wall Street today, encouraged by lower stock prices from the market's recent selloff and some mildly positive outlooks in the beleaguered sector.

"What you're seeing today is a little bit of money being put back to work as the market tries to grind away through earnings season," said Charles White, portfolio manager at Avatar Associates. "Although we've come back to the reality that the recovery is probably not as immediate as people had thought, things don't seem to be getting worse, so they are buying."

The Dow Jones industrial average closed up 17.16, or 0.2 percent, at 9,730.96, according to preliminary calculations.

The strongest gains came in the technology-focused Nasdaq composite index, which rose 39.85, or 2.1 percent, to 1,922.38.

The Standard & Poor's 500 index advanced 8.87, or 0.8 percent, at 1,128.18.

Semiconductor equipment maker Novellus rose $3.42, or 9.4 percent, to $39.65 after beating Wall Street fourth-quarter estimates by a penny. A positive forecast for 2002 from European software maker SAP AG also was rewarded. The stock gained $2.49 to $36.80.

Investors also bid Pfizer up $1 to $41.80 after the pharmaceutical company met Wall Street's expectations for the fourth quarter.

Trading reflected Wall Street's skittishness about making sizable commitments — and worries that corporate performance might not justify high stock prices.

IBM and General Electric fell after The Wall Street Journal published stories discussing their accounting practices. IBM lost $2.60 to $107.90, while GE fell 65 cents to $37.65. The recent collapse of Enron, and the subsequent scandal about its bookkeeping, has made many investors unsure of how much credence to give earnings reports.

Wall Street's hesitance also might have been related to new budget projections, showing the U.S. government will spend more than it takes in this year and in 2003. The nonpartisan Congressional Budget Office says the shortfall was caused by the recession, the $1.35 trillion, 10-year tax cut approved last year and the cost of the war on terrorism.