Tech Spending Remains Strong

Rising oil prices, terrorism fears and lackluster consumer spending may be holding back the broader economy, but technology spending remains strong.

The May issue of CIO Magazine said IT spending projections rose to 7.8%, the highest reading since January. It was the fifth consecutive month of steady readings for the survey, evidence of a “slow but steady” recovery in IT spending, according to Prudential strategist Ed Yardeni.

After the recent cycle of spectacular boom and bust, slow and steady would probably sit just fine with most investors.

The broader market managed to finish with modest gains Tuesday despite soaring oil prices and growing terrorism fears.

The Nasdaq rose 4 to 1990, the S&P 500 added half a point to 1121, and the Dow tacked on 14 to 10,202. Volume rose to 1.23 billion shares on the NYSE, and 1.46 billion on the Nasdaq. Advancers led 17-16 on the NYSE, and 17-14 on the Nasdaq. Upside volume was 49% on the NYSE, and 51% on the Nasdaq. New highs-new lows were 79-20 on the NYSE, and 95-32 on the Nasdaq.

After the close, Nortel announced it will give a business update Wednesday morning.

During the day, Accenture gained 3% on a homeland security contract that could be worth billions.

Axsys jumped 13% after raising guidance.

Manugistics fell 9% on a warning.

Spectrum Signal Processing jumped 20% on a deal with Lockheed Martin.

AT&T slid 4% to a new 52-week low after failing to reach a wholesale agreement with Verizon .

F5 edged higher on a security acquisition.

Oracle lost 2.5% on a downgrade.

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