Stocks Rise On Greenspan Comments

Stocks rose Monday on comments from Federal Reserve Chairman Alan Greenspan that inflation is under control, giving traders hope for further rate cuts.

The ISDEX http://www.wsrn.com/apps/ISDEX/ slipped fractionally to 257, and the Nasdaq climbed 6 to 2155. The S&P 500 added 6 to 1267, and the Dow rose 71 to 11,061, back above the important 11,000 level. But volume dried up to its lowest level of the year: 976 million shares on the NYSE and 1.3 billion on the Nasdaq. Advancers led 19 to 10 on the NYSE, and 20 to 17 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 bell, Comverse Technology rose after beating estimates by a penny with 43-cent earnings, and Xilinx rose after reaffirming estimates.

During the day, GoTo.com did something that Net stocks haven't done much of lately: the stock rose 2.57 to a new 52-week high of 26. The stock has led the ISDEX off its April 4 bottom.

Traders took Oracle's announcement that it will report earnings on June 18 as a good sign, because the company did not warn. Oracle gained .24 to 16.10.

Semiconductor stocks were weak on a warning from Cypress Semiconductor and concern that Intel will warn when it holds its first-ever mid-quarter update on Thursday. A downgrade to Broadcom also hurt chip stocks.

Juniper rose 1.96 to 44.75 on optimism that it will announce a new product this week. Some analysts are concerned that the next new product introduction may not occur until the fall.

Check Point plunged 5.32 to 49.85 on worries about pricing pressure and increasing competition.

New issue Simplex Solutions continued to rocket, up 11 to 39 in the wake of its conference call and a Robertson Stephens Buy rating.

RealNetworks surged 1.43 to 12.43 on optimism that trouble between Microsoft and AOL could mean more business for RealPlayer and less for Windows Media Player.

Cisco rose 1.20 to 20.05 on comments that it is not in talks to buy Marconi .

Nortel gained .59 to 14 after announcing it will reprice employee options.

MyPoints.com rose .95 to 2.55 on news that it will be bought out by a UAL unit for $2.60 in cash.

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

Another nice day today, but the very low volume still argues for more downside. Today through Wednesday is a possible cycle turn window, so whichever way stocks move on rising volume this week could dictate near-term direction. 1200 on the S&P 500 and 2000 on the Nasdaq remain our lines in the sand; above those levels, the market looks okay, and below those levels, a retest of the lows becomes likely. The Dow (first chart) took out both the important 11,000 level and its main downtrend line today, but the low volume calls the breakout into question. Critical support on the index is 10,750, a trendline off the March lows. The S&P 500 (second chart) cleared the important 1265 level, the neckline of a potential inverted head-and-shoulders bottom, but again, the breakout came on the lowest NYSE volume of the year. A move above 1275 would be a big plus, and 1254-1265 is first support. The Nasdaq (third chart) is firmly back above its September downtrend line, which is now around 2050-2080, but the Nasdaq and Nasdaq 100 (fourth chart) could both be forming bearish rising wedges (the blue lines), and the Nasdaq 100 is still below its September downtrend line.

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.