For One Day, At Least, Markets Bloom

They started up and just kept rising. By the time Thursday’s closing bell rang, stocks across all sectors gave loss-weary investors a day to remember.

Taking an ebullient break from this year’s remorseless pounding, the market roared out of the gate Thursday morning, fueled by news that PC maker Dell Computer expects to meet Wall Street estimates for Q1 revenue and earnings. (A few months ago investors would punish companies that “only” met expectations. Funny how a bear mauling changes your perspective.)

The bull run was led by Internet and tech stocks, with’s Internet Stock Index, or ISDEX, soaring 25.68, or 15.8%, to 187.99. Forty-nine of the 50 ISDEX member stocks advanced, of which 17 posted gains of at least 20%.

The Dow Jones recorded its second-highest point increase ever, finishing at 9918.05, a gain of 402.63, or 4.2%, while the Nasdaq zoomed up 146.33, or 8.9%, to 1785.13. The S&P 500 closed up 46.25, or 4.2%, to 1149.50.

(For earnings reports, visit our earnings calendar and our reported-earnings page.
For after-hours quotes and news, visit After Hours Trading.)

Twelve of 13 Internet sectors had more advancers than decliners, the exception being Advertising/Marketing, which had an equal number of stocks up and down. For all sector breakdowns, visit WSRN’s Internet sectors page.

Significant gainers among ‘Net tickers were:

High-end router maker Juniper Networks , which gained 27.3% to $37.16 after a Needham & Co. analyst raised his rating for JNPR to “strong buy” from “hold.” (And after I wrote this morning that it was headed down to $20.)

Portal leader Yahoo! rose 22.6% to $15.25 following an upgrade to “buy” from “market perform” from Lehman Brothers.

Dell finished up 13.5% to $25.19 after reaffirming Q1 target numbers of $8 billion in sales and a net profit of 17 cents per share.

Three Internet security companies cleared the 20% bar. Netegrity was up 27.1% to $22, two days after Dain Rauscher Wessels reiterated a “strong buy” rating for the maker of user-access software. Still, NETE has tumbled about 65% since the beginning of February.

Internet Security Systems advanced 21.4% to $26.31, with another “strong buy” reiteration from Dain Rauscher Wessels possibly providing the lift. One of the few ‘Net gainers on Wednesday, ISSX was in danger Tuesday of finishing below $20 for the first time since December 1998.

RSA Security climbed 20.8% to $22.50. Odd, because Dain Rauscher Wessels didn’t say anything about it. But First Analysis cut RSAS to “accumulate” from “strong buy.”

On the downside…you know what, we’ll skip the downside today. Here’s some technical analysis from Paul Shread:

April 5, 4 p.m.: A nice rally today, and the Trin, a good measure of
institutional buying pressure, was at its best level in some time today.
It would have been nice to see a little more volume, but it’s a start,
and a good one at that. The problem is that the S&P 500 closed right at
its main downtrend line from late January (first chart), so tomorrow’s
going to be more important than today. The S&P could gap up through that
line, or it could turn back. The unemployment report at 8:30 a.m. will
likely be the key. Above that, the S&P needs to get above 1184 to begin
to call a turn. 1140 is first support on the S&P, and then 1120 and
1090. The Nasdaq is quite a way still from its downtrend line, which we
will redraw to include the two Nortel warnings that short-circuited
breakouts out of that line; that line should be at about 1840-1850 for
tomorrow (second chart). We want no doubt about any breakout this time,
and we want to see the index hold above that line when the break comes.
Another problem is the huge gap created at the open today; can the
Nasdaq really leave a 5% gap at the very bottom? Stranger things have
happened, but it seems unlikely to us. The Dow is another index that
stopped just short of critical resistance today: 9992 (third chart). A
close above 10,000 would be a good sign for the broader market. One
positive for stocks is that the Dow and S&P set higher lows yesterday,
on dojis, or indecision days that can signal a turn. Now they need to
set higher highs.

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