CAT Hurts Blue Chips As Techs Take Out New Highs

A profit warning from Dow component Caterpillar [CAT>CAT] kept the
Industrial Average underwater today but Techs remained on a tear as the Nasdaq
set its 14th record in 16 sessions.


The Dow fell 31.81 to 11,003.89, the Nasdaq gained 22.14 to 3369.25 and the S&P 500 fell 2.94 to 1421.99.


Caterpillar, the world’s largest maker of earth-moving equipment, fell 6 9/16 to 49 3/8 on the profit warning. AlthoughIBM [IBM>IBM] gained 6 5/8 to 104 5/4, the move was insufficient to overcome the loss in Caterpillar and cyclical International Paper[IP>IP], keeping the Dow down.

Technology continued its dramatic run-up as new 52-weekhighs were postedby Oracle [ORCL>ORCL], Cisco[CSCO>CSCO], National Semiconductor [NSM>NSM],Computer Associates [CA>CA] and JDSUniphase [JDSU>JSDU]. Even Intel[INTC>INTC] showed signs of new life after recent declines and rose 1 3/8 to 79 7/8.


High flyers for theday included China.com [CHINA>CHINA], up 24 5/15 at 11711/16, Broadcom [BRCM>BRCM], up 21 11/16 at 196 1/2, CobaltNetworks [COBT>COBT], up 21 1/2 at 133 3/4 and TIBCO Software[TIBX>TIBX], up 17 at 123 1/2.


TheMexico index [$MXY.X>$MXY.X] was the day’s strongest sector, finishing 2.59% higher, rising as the Mexican Bolsa closed at a new record. The index has gained 15 of the past 17 days and 32% from its low last month. GrupoTelevisa [TVT>TV] was the biggest point-gainer on the index, adding 4 15/16 to 53 15/16 and Telefonos de Mexico[TMX>TMX] rose 2 1/16 to 100 1/16.


After The Closing Bell Microsoft[MSFT>MSFT]] was up nearly 4 points in extended hours trading on news that Judge Thomas Penfield Jackson appointed a mediator in Microsoft’s anti-trust proceedings. The appointment of a mediator may indicate that Microsoft wants to settle the case quickly rather than drag it out as IBM did in its anti-trust case fifteen years ago.


Since the court branded Microsoft a ‘monopoly,’ Microsoft has fallen 6 points and remains 15 points below its all-time high. Traders will be watching next week to see if the settlement talks can reinvigorate the software giant that has lagged the recent run-up in techs.