RealTime IT News

Stocks Stage Late-Day Rally

Stocks staged a late-day rally on Wednesday on rumors that Osama bin Laden had been captured, but military officials denied the rumors after the close.

The ISDEX http://www.wsrn.com/apps/ISDEX/ slipped 1 to 123, and the Nasdaq added 9 to 1673. The S&P 500 rose 6 to 1086, and the Dow climbed 52 to 10,157. Volume declined to 1.15 billion shares on the NYSE, but rose to 1.73 billion on the Nasdaq. Advancers led 16 to 15 on the NYSE, but decliners led 19 to 15 on the Nasdaq.

After the close, NVIDIA topped estimates, and Qwest's debt was cut to junk status by S&P. Credence beat estimates, and priceline reaffirmed guidance.

During the day, Qualcomm fell on fears of weak sales in China.

Semiconductor equipment stocks fell on concern that Intel will cut CapEx spending. Novellus and Applied Materials ended lower and continued to slip after hours.

Sun Microsystems gained 6% ahead of its mid-quarter update on Thursday.

Security stocks were weak on negative company and analyst comments. Internet Security , Check Point and Symantec all fell 7%-8%.

Redback gained 18% on an investment from Nokia .

Sycamore and Semtech were little changed despite beating estimates.

Some technical comments on the market: Note: To see the charts in the text email newsletter, click on the internetstockreport.com story link at the top of the newsletter.

The Nasdaq (first chart below) held the 1640 support level today, and the S&P 500 (second chart) held 1074 support today. That's the first time since the market reversed last Friday that a support level has held. The trend may now be up into the end of the week, but we suspect the rally may have trouble getting above 1696 on the Nasdaq and 1100 on the S&P. 1088-1091 is first resistance on the S&P. The Dow (third chart) held its 20-day moving average at about 10,070 today. 10,150 is an important level, and 10,200-10,250 is tough resistance. Finally, we're going to mention one last level to watch heading into June, a futures expiration month. The average cost of the Dow June futures positions is about 10,220 at the moment, according to one firm. If the Dow is significantly below that level as it approaches expiration at the end of next month, the blue chips could be in for some selling as futures traders begin to cut their losses.

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Special report: For a free introduction to technical chart patterns, visit http://www.internetstockreport.com/guest/article/0,1785,2571_500051,00.html.