Chips Take Charge
Amid storm worries, earnings warnings,
and yet more downgrades, the Nasdaq managed to book a 1.2% gain Monday on very
light volume of 1.48 billion shares. Despite a warning from Vitesse
Semiconductor, the chip group held on and was the top sector of the session.
Vitesse even finished up 1 1/4 to 39 1/16.
The broader market held solid as well,
with the Dow adding 0.9% and the S&P 500 rising 0.6%. NYSE volume was a
light 926 million shares.
Analysts again raised concerns over
the ongoing lack of fear that they continue to see in the market. Most feel
stocks still need to capitulate if we are going to see a true bottom.
“Don’t
worry…be invested. That seems to be the
strange new credo.
While anything is better than ‘buy the dips,’ this lack of fear is not
good,” said Frank Gretz, Market Analyst, Shields & Company.
“They
say investor sentiment goes through three phases.
The first, which we’ve seen a lot of, is outright complacency.
The second, and the one we seem in now, is concern.
In the concern phase the news has turned bad, losses are mounting and
investors are, well, concerned.Â
The last phase is the fear phase and it’s in the fear phase that
bottoms are made,” he added.
According
to preliminary figures, the Nasdaq gained 25.17 to 2142.80, the Dow added 95.99
to 10,562.30, and the S&P 500 lifted 7.21 to 1241.39.
Top
sectors included semiconductors
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up 2.9%, and computer technology
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On
the weaker side were broker/dealers
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down 1.0%, and biotechnology
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Top
SOX winners included Teradyne
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up 9%, and Micron
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The SOX also got some help from
Novellus
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average and closed about 1 1/2 points below that all-important 200-day moving
average.
Novellus has bounced back from last week’s lows on heavier-than-average
volume, which suggests that institutions might be picking up some shares.
Novellus closed up 3 or 7.5% to 44 on heavier-than-average volume.
Dow winners were AT&T
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5.2%, Caterpillar
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up 3.6%. The Dog dog of the day was Coca-Cola
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of management changes.
Looking
ahead, the forth quarter productivity numbers are due out Tuesday at 8:30 AM ET,
and analysts expect a 2.0% rate of increase. Also due out is the January factory
orders report at 10:00 AM ET, and estimates call for a 2.2% decrease.