Google Shows Smarts

Google showed this week that it’s learning how to play the game.

The company announced late Wednesday that it will sell as much as 5.3 million shares worth about $2 billion ahead of its inclusion in the S&P 500 Friday night. Google shares lost 1.7% Thursday on the news, but the move appears to be a shrewd one by Google to curry favor with Wall Street, something the company hasn’t done much of in its brief time as a public company.

Google said in an SEC filing that the shares “will be offered primarily to index funds whose portfolios are primarily based on stocks included in the S&P Index. These index funds may be required to purchase shares of our Class A common stock as a result of the inclusion of our Class A common stock in the S&P 500 Index.”

The move will make it easier for index funds to buy Google shares without having to pay all the premium that usually occurs between the announcement that a stock will be added to the index and the day it joins.

With $8 billion in cash on hand already, the move raised speculation that Google might be planning to buy a company like , which surged 6.5% Thursday. But it just might be that the company is simply becoming a little more savvy.

Tech stocks posted modest gains Thursday, but blue chips fell on fear of inflation and rising interest rates.

The Nasdaq rose 3 to 2340, the S&P 500 lost 2 to 1300, and the Dow fell 65 to 11,150. Volume rose to 2.26 billion shares on the NYSE, but declined to 2.19 billion on the Nasdaq. Decliners led 18-14 on the NYSE, while advancers led by a handful of shares on the Nasdaq. Downside volume was 51% on the NYSE, and 45% on the Nasdaq. New highs-new lows were 258-54 on the NYSE, and 235-28 on the Nasdaq.

Nokia gained 5% on a bullish forecast.

ATI gained 8% on its results.

SigmaTel tumbled 12% after cutting guidance.

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