Chips Zip
Inflation friendly economic numbers and an analyst upgrade on Intel
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helped ignite a Nasdaq fire that sent the average soaring 3.7%. Semiconductors
and networkers led a Nasdaq charge that even managed to coax the recently weak
financials back into the green.Â
By the close, the S&P 500 managed to book a 1.0% gain which was a nice
bounce off of its Monday close at its 200-day moving average. The Dow, however,
failed to join the party and finished down 0.2%.
In economic news, August housing starts came in at 1.51 million units, which was lower than the
1.54 million that analysts had expected. Technology shares rose gradually
throughout the day and then rallied into the close following favorable trade
news on China.
Volume increased by about 5% from Monday’s levels, as 1.69 billion shares
traded on the Nasdaq, and 1.02 billion shares traded on the NYSE
“While the Nasdaq Composite is currently relatively flat to down for the
year, we still don’t think there’s any ability for a sustained rally because we
don’t see any broad-based public interest in the marketplace,” said Kenneth
Pasternek, Chief Executive Officer, Knight Trading Group.
“We’re relatively cautious about the intermediate outlook until we see a
catalyst for individual investors because we think that ultimately that is the
group that will take the market to higher levels. We just don’t see a catalyst
right now,” he added.
According to preliminary numbers, the Nasdaq jumped 139.23 to 3865.61, the
S&P 500 gained 15.39 to 1459.90, and the Dow slipped 19.23 to 10,789.29.
Top sectors included semiconductors
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up 4.0%, Internets
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up 3.2%.
On the weaker side were forest and paper products
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retailers
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2.3%.
Red-hot chip stocks powering the surge in the SOX included Advanced Micro
Devices
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10%, Micron
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Looking ahead, the rest of the week is relatively light for economic news,
but due out Wednesday at 2:00 PM ET is the Beige Book.