Tech stocks led the way higher Monday as the stock market neared its first positive month since October.
JP Morgan’s sweetened bid for Bear Stearns and an unexpected rise in existing home sales raised hopes that the worst may be over for the subprime mortgage crisis that has weighed on stocks for eight months.
The tech sector regained its leadership, with the Nasdaq’s 3% gain twice that of the Dow and S&P. Google, Apple, Research In Motion, VMware and Baidu returned to form, with gains of 5% or more each. Baidu, whose stock had fallen by more than half since November, soared 15%.
The chip sector was up 3.7% after Lehman Brothers upgraded several names in the sector and Barron’s had good things to say about Nvidia. Broadcom was another big winner, up 10%.
XM Satellite Radio and Sirius rose after their merger was cleared by the Justice Department. The two are still awaiting FCC clearance.
E*Trade and Level 3 were also big winners, gaining more than 10% each.
The Nasdaq surged 68 to 2326, the S&P gained 20 to 1349, and the Dow rose 187 to 12,548. Volume declined to 4.44 billion shares on the NYSE, and 2.32 billion on the Nasdaq. Advancers led by a 27-6 margin on the NYSE, and 22-7 on the Nasdaq. Upside volume was 80% on the NYSE, and 89% on the Nasdaq. New highs-new lows were 36-36 on the NYSE, and 53-116 on the Nasdaq.