Microsoft Extends Naz Streak
Optimism about Microsoft’s ongoing antitrust battle and resiliency in Oracle
after a downgrade helped power the Nasdaq 1.2% higher Wednesday for its
fifth-straight positive close. The strength in Microsoft also carried over to
help the broader averages which posted positive numbers despite weakness in
banks and broker/dealers. The Dow rose 0.6% while the S&P 500 gained 0.2%.
Nasdaq volume was 1.53 billion shares, which was about 10% below Tuesday’s
level, and NYSE volume remained flat at a little over a billion shares. While
volume remained lighter than many traders would have liked to have seen, several
commented that for a Wednesday in the third week in June, it was actually a
pretty good amount.
With the Fed scheduled to meet on Tuesday, all eyes were on Chairman Alan
Greenspan this morning as he met with the Senate banking and agricultural
committee. With no major surprises from the Fed Chairman, stocks traded orderly
and calmly for the remainder of the session. Traders commented that most of the
recent weeks’ fear has finally been wrung out of the market.
"I think the market’s just taking a breather here from its recent run.
The Nasdaq is up 1000 from its low, and people tend to not focus on that. The
Dow has been trading a range, but the Nasdaq, after its rather sharp correction
or bear market that took it down form 5000 to 3000, is now back up 1000 points.
Compared to a few weeks ago, the Nasdaq is feeling a heck of a lot better,"
said Arnie Owen, Managing Director of Equities,
Cruttenden Roth.
According to preliminary numbers, the Nasdaq gained 50.62 to 4063.98, the Dow
added 62.58 to 10,497.74, and the S&P 500 rose 3.18 to 1479.13.
Top-performing sectors included oil services
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biotechnology
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1.6%, integrated oils
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up 1.4%.
Weaker sectors included retailers
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down 1.4%, and broker/dealers
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Regarding the outlook for next week’s Fed meeting, Gregg Parise, General
Partner, Dorado Capital Management said, "I think the Fed meeting is going
to be a positive catalyst for the market. I think if they raise them 25 basis
points, we’re going to have people give a sigh of relief, and if they leave them
unchanged, people are going to think the economy is slowing, and then it’s off
to the races."
Microsoft
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antitrust case against the software giant could possibly get overturned during
the appeals process. Microsoft is also scheduled to announce a wide range of
Internet strategies in a much-publicized event at the company’s Redmond, Wash.
headquarters on Thursday.
Oracle
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received a downgrade from Merrill Lynch. Oracle traded down nearly 6 points to
80 5/16 before rallying to a slightly positive close of 86 3/16.
Leading the biotech index higher were Immune Response
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Immunex
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Biogen
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Looking ahead, the weekly unemployment numbers at 8:30 AM ET on Thursday and
should serve as one of the final clues as to what the Fed may do regarding
interest rates when it meets next week.