Intel leads Nasdaq's ascent to a new high S&P 500 posts another record

Dow industrials rise 89

Wall Street

July 09, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks rose yesterday as Intel Corp. led the Nasdaq composite index to its first record since April 22 on expectations that semiconductor sales will rebound.

The Nasdaq jumped 27.28, or 1.4 percent, to 1,935.39, surpassing by nearly 20 points a record set April 22.

The 30-stock Dow Jones industrial average rose 89.93, or 1 percent, to 9,174.97, coming within 37 points of its May 13 record.

The Standard & Poor's 500 index rallied to its second record of the week, finishing up 11.71, or 1 percent, to 1,166.37.

Travelers Group Inc. and Citicorp led the S&P climb after influential Merrill Lynch & Co. analyst Judah Kraushaar estimated in a report that the profit of the combined Travelers-Citicorp could rise 20 percent next year as the companies cut hundreds of millions of dollars in costs when they combine to form the world's biggest financial company.

Among other broad indexes, the Russell 2,000 index of small capitalization stocks rose .93 to 459.97; the Wilshire 5,000 index jumped 97.77 to a record 10,936.85; the American Stock Exchange composite index gained .69 to 728.65; and the S&P 400 midcap index added 3.05 to 369.61.

The Sun-Bloomberg Maryland index, which tracks the top 100 Maryland stocks in Maryland by market valuation, rose 2.26 to 232.14.

Intel, up $3.1875 to $78.3125, got a boost from Morgan Stanley Dean Witter & Co. analyst Mark Edelstone. He reiterated his "strong buy" rating on the No. 1 maker of computer chips and said its business will see a rebound in the second half of the year.

Advancers outnumbered decliners by a 17-to-12 ratio.

Internet stocks took a roller-coaster ride for a second day, rebounding from an early plunge.

The stocks dropped at the opening after the Wall Street Journal questioned the valuations of many Internet companies. The Journal pointed out that Amazon.com Inc. has a market capitalization of about $6 billion -- more than rivals Barnes & Noble Inc. and Borders Group Inc. combined -- but no profits. Amazon fell $15 to $107.125, extending Tuesday's $17.375 drop.

Yahoo! Inc. finished down $5.25 to $185.875, after touching $175 and $198.50 during the day in anticipation of its earnings report. After the market closed, the Santa Clara, Calif.-based Internet directory posted operating income of $8.1 million, or 15 cents a share, compared with a $300,000, or 1 cent per share, operating loss in the second quarter last year.

Yahoo! said traffic to its Web sites grew to an average of 115 million page views per day in June, up from 95 million in March.

The puncturing of the bubble in Internet stocks freed money that HTC is going into other large computer-related stocks such as Intel, Microsoft Corp. and Dell Computer Corp., traders said.

Motorola Inc. fell $2.8125 to $52.1875 after reporting profit of a penny a share.

Analysts had expected a 4-cent loss, but some investors were spooked by a warning from Christopher Galvin, Motorola's chief ex- ecutive, that Asia's economic crisis will continue hurting the company's business "for at least the remainder of the year."

Investment adviser Eakle pointed out that Motorola has struggled much of the time for years. Its stock has declined about 16 percent since 1996, while the S&P has almost doubled. Asia's financial turmoil began last summer.

Harbinger Corp. fell for a sixth day, down $1.9375 to $12.8125.

On Tuesday, the maker of software for electronic commerce said second-quarter earnings and revenue will miss forecasts. Analysts at First Albany Corp., J. P. Morgan Securities and BancAmerica Robertson Stephens subsequently downgraded the stock.

Walt Disney Co. bounced up $1.8125 to 108.$375.

Disney's Miramax Films unit said it is forming a venture with British editor Tina Brown to publish a monthly magazine and produce films and television programs. Brown is leaving the New Yorker magazine, where she has been editor since 1992.

Pub Date: 7/09/98

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