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The Honolulu Advertiser

Posted at 11:25 a.m., Tuesday, October 21, 2003

Technology shares move up; Dow drags

Hawai'i Stocks
Updated Market Chart

By Meg Richards
Associated Press

NEW YORK — Technology shares boosted by Texas Instruments’ solid earnings report led Wall Street moderately higher today, but the Dow Jones industrials lagged, held back by disappointing news from AT&T.

Analysts said earnings reports didn’t give the market a more significant advance because, while third-quarter profits have generally been strong, investors already have pushed stocks higher in anticipation of robust results. Earnings are reflected in many companies’ share prices, said Jack Caffrey, equities strategist at J.P. Morgan Private Bank.

"Unless they’re going to tell a very compelling story or show dramatic improvements, investors are more inclined to take some of these profits," Caffrey said. "I think we’re going to be seeing some very choppy trading over the next several weeks."

The Dow Jones industrial average closed down 30.30, or 0.3 percent, at 9,747.64.

The broader market indexes closed higher. The Nasdaq composite index was up 15.76, or 0.8 percent, at 1,940.90. The Standard & Poor’s 500 index was up 1.35, or 0.1 percent, at 1,046.03.

The rise in the tech-dominated Nasdaq was attributed to strong performances and positive forecasts of semiconductor and biotech companies. With tech firms offering the brightest fourth-quarter outlooks, investors were buying selectively in the hopes of finding bargains, said Richard E. Cripps, chief market strategist for Legg Mason in Baltimore.

"The thinking is that we are reaching a little bit here, but we’re still faced with the idea that there’s no better place to put your money," Cripps said. "It’s also the psychology of the moment ... nobody wants to miss it."

Texas Instruments’ third-quarter profits more than doubled on rising semiconductor sales, beating analysts’ forecast by 2 cents a share. The chip maker rose $1.61, or 6.3 percent, to $27.28.

Investors were awaiting results after the close from online retailer Amazon.com, drug maker Amgen Inc. and medical-device manufacturer Boston Scientific.

AT&T Corp. dropped $1.07, or 5.1 percent, to $20.00 after the company released disappointing news with its third-quarter results. While profits nearly doubled compared to a weak showing a year ago, revenues fell 8.1 percent as Bell rivals and cell phones gained a growing share of the long-distance market.

Officials also revealed that AT&T executives overstated profits by $125 million in 2001 and 2002 to cover up an accounting mistake.

Eastman Kodak Co. was up 52 cents, or 2.3 percent, at $23.64, after shareholders said they would ask the company to reconsider a plan to sharply reduce its dividend as it makes aggressive strides into the digital camera market, stepping back from its traditional film business. Kodak was among dozens of companies set to report earnings tomorrow.

Other big companies scheduled to release results tomorrow included DuPont Co., J.P. Morgan Chase & Co. and McDonald’s Corp. Reports also were expected from virtually all of the major drug companies.

Advancing issues outnumbered decliners about 5 to 4 on the New York Stock Exchange. Volume was light.