Semi-Bounce
The Nasdaq reversed its three-day slide and moved higher Thursday, led by
renewed strength in semiconductors and biotechs. By the close, the Nasdaq had
gained 2.1% while the S&P 500 managed a 0.7% rise. The Dow, however, ended
down 0.5%, mainly as a
result of a profit warning from Du Pont chemicals
(
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PowerRating).
Volume remained relatively light despite all the talk last week of big volume
returning with the end of summer. Nasdaq volume was a moderate 1.61 billion
shares while 978 million shares changed hands on the NYSE.
“Essentially, what we’re looking at is a market where each day is a new
adventure. Rotation in the market continues to be very rapid, and we’ve come out
of a positive August and headed into September, which in most cases is the
cruelest month of the year. It would actually not be surprising to see a little
more wringing out of the excesses in the technology sector before technologies
get their second wind,” said Alan Ackerman, Market Strategist, Fahnestock
& Co.
“Conversely, the plus for the market right now is that the Fed appears
done for the moment and that productivity continues up. We saw the fastest gain
in productivity since 1989 just the other day, and that’s keeping unit labor
costs down. On balance, I would continue to be looking to buy the techs on the
dips,” he added.
According to preliminary numbers, the Nasdaq gained 84.31 to 4097.65, the
S&P 500 added 10.16 to 1502.41, and the Dow slipped 51.51 to 11,259.13.
Top sectors included biotechnolgy
(
$BTK.X |
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PowerRating), up 5.8%, semiconductors
(
$SOX.X |
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up 3.4%, technology
(
$PSE.X |
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(
$DRG.X |
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1.8%.
On the weaker side were cyclicals
(
$CYC.X |
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paper products
(
$FPP.X |
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PowerRating), down 3.2%, and chemicals
(
$CEX.X |
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PowerRating), down
7.1%.
Leading the SOX with big gains were Xilinx
(
XLNX |
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PowerRating), up 6.8%, National Semi
(
NSM |
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PowerRating),
up 5.4%, Lattice Semi
(
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PowerRating), up 5.4%, Micron
(
MU |
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PowerRating), up 4.8%, and Altera
(
ALTR |
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PowerRating),
up 4.1%.
Also strong Thursday were the biotechs, which have been under selling
pressure over the past two sessions. Leading the biotech index higher were Gilead Sciences
(
GILD |
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PowerRating), up
10%, Protein Design Labs
(
PDLI |
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PowerRating), up 9%, Genzyme
(
GENZ |
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PowerRating), up 8%, Vertex
Pharmaceuticals
(
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PowerRating), up 7%, MedImmune
(
MEDI |
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PowerRating), up 7%, and Amgen
(
AMGN |
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PowerRating), up 4%.
Tech screamers included Applied Micro Circuits
(
AMCC |
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PowerRating), up 19 29/32 to
198 15/16, Siebel Systems
(
SEBL |
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PowerRating), up 14 9/16 to 197 1/8, and Marvell
Technology
(
MRVL |
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PowerRating), up 12 1/12 to 95 1/2.
A profit warning from chemical giant Du Pont
(
DD |
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PowerRating) drove the stock down
5 3/16 or 11% to 41 13/16, and that helped keep the Dow negative on
the day. Also losing ground in the Dow were J.P. Morgan
(
JPM |
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PowerRating), down 3.0% and
Honeywell
(
HON |
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PowerRating), down 5.5%.
Among the Dow leaders were General Motors
(
GM |
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PowerRating), up 2 11/16 to 76 5/8, Hewlett Packard
(
HWP |
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PowerRating), up 3 3/16 to 123 13/16, Boeing
(
BA |
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PowerRating), up 1 9/16 to 59 3/8, and Intel
(
INTC |
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PowerRating), up 1 3/4 to 67 7/16.
Looking ahead, the only economic news scheduled for Friday is the consumer
credit report for July, which will be released at 3:00 PM ET.
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