High-tech stocks lift NASDAQ to a high

WALL STREET

January 15, 1993|By Bloomberg Business News

NEW YORK -- Computer-related companies led gains in stocks yesterday as the NASDAQ index of smaller stocks closed at another all-time high.

The Dow Jones industrial average rose 4.32, to 3,267.88. Computer-driven buy orders pushed the Dow higher in the final minutes.

"It's a couple of stocks, namely J.P. Morgan and Merck, that held back the Dow," said Edward Collins, executive vice president of institutional trading at Daiwa Securities America. "Meanwhile, the broader averages are soaring."

The NASDAQ index rose 8.92, to 695.70, led by gains in Intel and Tele-Communications. The Standard & Poor's 500 index gained 2.92, to 435.95, and the American Stock Exchange Market Value index climbed 2.50, to 401.06. The Dow Jones transportation average soared 29.41, to 1,496.34.

Advancing stocks outnumbered declining issues by 2-to-1 on the New York Stock Exchange. Trading was active, with 280 million shares changing hands.

Leading computer companies, such as Intel, Digital Equipment and Compaq, fueled a rise in the stock market, as investors turned increasingly optimistic about the industry's earnings prospects. "The high-tech stocks are roaring," Mr. Collins said.

"Intel reported fabulous earnings [Wednesday], and that initiated the rally in NASDAQ stocks," said Barry Berman, head trader at Robert W. Baird & Co. "Now, it seems almost every computer company is reporting strong results."

The S&P Electronic Semiconductor Index, which tracks the five largest independent semiconductor makers, rose 7.00, to a 10-year high of 144.71. Semiconductor manufacturers turned optimistic about their business prospects early last year, when they reported a strong turnaround in earnings.

Intel gained an additional $2.75 yesterday, to $112.75; Motorola surged $10.875, to $123.25; Texas Instruments soared $3.125, to $56.625; Compaq rose $3.25, to $53.875; and International Business Machines gained $1, to $48.75.

Atmel Corp., one of the smaller semiconductor makers, surged $1.875, to $18. The company reported that fourth-quarter net income soared 419 percent, to $4.72 million, or 25 cents a share, from $909 million, or 5 cents, a year ago.

Seagate, a manufacturer of computer disk drives, fell 50 cents, to $17.50. The company's stock was removed from the "recommended" list at Goldman, Sachs amid concerns about the earnings outlook.

Eastman Kodak rose $1.375, to $49.125, after the company initiated a plan that pegs salaries of its executives to the company's cash flow, earnings and revenue.

Digital Equipment soared $7.375, to $42.25. The computer company said its second-quarter loss narrowed to 57 cents a share, from $1.25 a year ago. Analysts had been expecting a loss of 87 cents a share.

Coca-Cola rallied $1.875, to $43.25. The company said it expects earnings to increase at an annual rate of 20 percent. Coca-Cola also said international sales exceeded expectations in December.

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