RealTime IT News

Intel Boosts Stocks

Stocks recovered from a sell-off after Intel reaffirmed its capital expenditure budget and said it expects business to pick up in the second half of the year.

The ISDEX http://www.wsrn.com/apps/ISDEX/ rose 5 to 287, and the Nasdaq gained 38 to 2282. The S&P 500 added 4 to 1293, and the Dow climbed 16 to 11,122. Volume declined to 1.28 billion shares on the NYSE, and 1.82 billion on the Nasdaq. Advancers led 15 to 14 on the NYSE, and 21 to 16 on the Nasdaq. For earnings reports, visit our earnings calendar at http://www.wsrn.com/apps/earnings/internet.xpl and reported earnings at http://www.wsrn.com/apps/earnings/ireported.xpl. For after hours quotes and news, visit our after hours trading site at http://www.afterhourstrading.com.

After the close, ADC Telecom fell after missing estimates and issuing an earnings warning.

First quarter GDP is expected to be revised downward tomorrow morning. Weaker than expected new home sales weighed on the market this morning.

Semiconductor stocks recovered from a 3% drop to finish down fractionally after Intel said it will maintain its $7.5 billion CapEx budget this year. Equipment stocks led the recovery. Applied Materials rose 1.48 to 54.42, and Novellus added .10 to 52.95, 2.45 off its low.

Merger partners TriQuint , down 4.05 to 20.76, and Sawtek , off 4.86 to 23.39, fell after issuing profit warnings. Broadcom lost 2.04 to 40.18 after a plan to reprice employee options over the next 6 months was viewed as a sign of further downside risk.

Dell'Oro issued a report on optical equipment market share. Gaining share in the transport market were Lucent and Ciena , while Nortel's share plunged from 52% to 29%. ONI Systems grew 50% in the DWDM metro market, while Nortel gained slightly and Ciena lost slightly.

Sun Microsystems , down .03 to 21.46, continued to lag ahead of Tuesday's analyst meeting.

i2 rose .97 to 26.83 on a deal with IBM.

Some technical comments on the market: Note: We include charts in the technical market commentary. If you can't get the charts via the e-mail newsletter version, try this link: http://www.afterhourstrading.com/column.html

A promising day today. The indexes all found support near the top of the trading ranges broken out of recently (11,035 on the Dow, 1273 on the S&P 500, and 2233 on the Nasdaq) and reversed nicely. The Nasdaq finished to the plus side, while the Dow, S&P and the Philadelphia Semiconductor Index formed dojis, or potential reversal patterns (trading higher, lower and finishing close to unchanged). The S&P 500 recovered to close back above its September downtrend line (first chart), and the Nasdaq (second chart) recovered the important 2252 level after trading as low as 2226. The Dow (third chart) found support at its broken downtrend line at today's low of 11,044, another good sign. 11,200 is first resistance on the Dow, then 11,300 and 11,400. 11,000-11,035 is critical support. The day before a three-day holiday is historically positive, so we may get more upside tomorrow if the market likes the morning's economic news, but we have two more important turn dates right around the corner, May 29 and June 4, according to one top-notch cycle watcher, and they could mark tops.

Special report: For a free introduction to technical chart patterns and an overview of last year's action in the stock market, visit http://www.internetstockreport.com/guest/article/0,1785,2571_500051,00.html.