Markets Stay on Sunny Side
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The sunny attitude that has infused stock markets since Wednesday -- when short-term inflation fears were calmed a day after the Federal Reserve cut interest rates -- continued Friday, allowing traders to hit the weekend on a modest up note despite earnings warnings from hardware makers Dell and Palm.
Markets closed up slightly in relatively light trading, recovering from an earlier round of profit-taking that had all the major indices down at midday.
The Dow Jones ended a strong week by finishing up 53.16, 0.47 percent, at 11301.74. The Nasdaq was up 5.2 points, or 0.24 percent, at 2198.88. The S&P 500 rose 3.46, or 0.27 percent, to 1291.95.
The lone sour note was sounded by the internet.com Internet Stock Index, which suffered a modest decline by falling 0.29 points, or 0.11 percent, to 272.26.
, an electronic finanical marketplace spun off from Reuters Group, ended up 3.15, or 22 percent, at $17.65, down from a first-day high of $19.50. It raised $464 million by selling 32 million shares at $14.50, well above its initial offering range.
On Thursday optical switching company Telliumgained 36 percent on its first trading day. Today it enjoyed a strong follow-up, closing up 4 percent at $21.80.
It was a rough day for hardware manufacturers. Dellshares fell 1.09, or 4 percent, to $24.79 after the PC maker met lowered first-quarter estimates but downgraded its second-quarter earnings estimate by a penny per share because of falling demand.
Meanwhile, handheld computer maker Palmhit a 52-week low by falling 2.03, or 29 percent, to $5.02 after cutting its fourth-quarter sales forecast in half and warning of heavier-than-expected losses. The company also scotched plans to buy Extended Systems, citing the poor economy.
Palm's closest competitor, Handspring, suffered a similar sting as traders worried about continuing fallout from weak consumer demand. It closed down 1.69, or 16 percent, at $8.69.
Fresh reports of talks that could lead to an acquisition of Lucentby France's Alcatelpushed those stocks in opposite directions. Lucent finished up 0.14, or 1.4 percent, at $9.95 after climbing as high as $10.50, while Alcatel's American depositary receipts fell 1.89, or almost 6 percent, to $30.15. Both companies said they'll decide next week whether to enter formal negotiations.
Among Internet stocks, it was a good day for e-business software makers, as Art Technology Group, Vignetteand Broadvisionenjoyed healthy percentage gains.
But online consultancies faltered, as Sapient, Scientand Razorfishwere among the day's largest percentage losers.