Nasdaq rises 85.01 with Intel

Dow falls

Nextel climbs on news of possible merger with AT&T Wireless

Wall Street

September 08, 2000|By BLOOMBERG NEWS

NEW YORK - The Nasdaq composite index rose yesterday as Intel Corp. rebounded from a three-day swoon and Nextel Communications Inc. gained on a report that AT&T Wireless Group is considering a combination with the cellular phone company.

The Nasdaq climbed 85.01, or 2.1 percent, to 4,098.35, as Cisco Systems Inc., Microsoft Corp. and other computer-related shares rose after falling Tuesday and Wednesday. The technology benchmark had dropped 5.2 percent in the two days after surging 12 percent in August.

DuPont Co. had its worst day since the 1987 stock market crash after the world's largest chemical company said this year's profit won't meet expectations because of higher raw-materials costs, a falling euro and "some slowing" in the U.S. economy.

The Dow Jones industrial average dropped 50.77 to 11,259.87, with DuPont accounting for more than half the loss. The Standard & Poor's 500 index gained 10.26 to 1,502.51. Elsewhere on the broad market, the Russell 2000 index of small-cap stocks jumped 6.50 to 542.82; the Wilshire 5000 index surged 110.68 to 14,155.35; the American Stock Exchange composite index advanced 3.03 to 974.18; the New York Stock Exchange composite index added 1.03 to 675.49; and the S&P MidCap 400 index climbed 7.79 to 548.20, within a quarter-point of its record close.

The Sun-Bloomberg Maryland index of Maryland stocks soared 6.51 to 284.50. Human Genome Sciences Inc., which has tumbled more than $20 a share this week, advanced $7.5625 to $163.9375. Aether Systems Inc. rose $6.625 to $144.

Advancing issues led decliners by a narrow margin on the NYSE on volume of 985.5 million shares. Nasdaq advancers outnumbered decliners 3-to-2 in trading of 1.6 billion shares.

Nextel climbed $2.9375 to $53. The Wall Street Journal reported that AT&T Wireless, which has fallen 14 percent since its initial stock sale in April, plans at this month's board meeting to discuss how to lift its share price, including a possible combination with Nextel.

Intel, the world's biggest chipmaker, gained $1.73 to $67.4375 after three days of declines.

Micron Technology Inc., downgraded by an analyst Wednesday, jumped $4.75 to $73.50 yesterday on the Big Board.

Sun Microsystems Inc. rose $6.3125 to close at $123.9375, gaining back nearly all of its loss from Wednesday, when investors bid the stock below $118.

Cisco advanced $2 to $66.25 and Microsoft added 62.5 cents to $70.0625. Technology stocks fell the previous two days after a three-month rally in which the Nasdaq gained 34 percent.

Read-Rite Corp. rose $2.75 to $10.5625. The company, one of the largest makers of recording heads used in computer disk drives, said it formed a new firm to design and make components for fiber-optic networks.

Qwest Communications International Inc. declined $2.75 to $48.75. Some analysts are concerned about the No. 4 U.S. long-distance phone company's plan to increase capital spending this year and next by more than previously planned. Qwest bought local phone company US West Inc. for $44 billion in June.

Among blue chips, a mix of profit-taking and corporate warnings contributed to investor flight. DuPont Co. slid $5.1875, or 11 percent, to $41.8125, its biggest loss since Oct. 19, 1987. The company said it expects to earn $2.85 to $2.95 a share, before one-time items, below the $3.01 average analysts estimated. DuPont earned $2.58 a share last year.

Dow Chemical Co. fell $1.75 to $25.6875, and Rohm & Haas Co. slid $2 to $29.375.

Campbell Soup Co. inched up 25 cents to $25.125, even as it reported a 25 percent drop in fourth-quarter earnings as soup sales slumped, and warned that earnings for the coming quarter will be 6 cents to 8 cents per share below current estimates.

For the quarter that ended July 30, Campbell reported net income of $59 million, or 14 cents per share, compared with $79 million, or 18 cents per share, for the like period a year ago. Net sales declined 8 percent to $1.1875 billion from $1.3 billion in the year-earlier quarter.

Circuit City Stores, the No. 2 U.S. consumer electronics chain, and May Department Stores Co., owner of Hecht's and other retail chains, also warned yesterday that their quarterly earnings would be flat or below expectations. Circuit City fell 81.25 cents to $26.9375 per share, and May was down $1.3125 at $22.375.

Restoration Hardware dropped nearly 20 percent, falling $1.1875 at $4.8125, after the home furnishings retailer said it was in need of additional funding and had hired an investment bank to help it find a new source of capital.

Houghton Mifflin Co. dropped $6.50 to $43.8125, after earlier touching its lowest level since June. The textbook publisher said it expects charges of 8 cents to 10 cents a share this year and 25 cents to 28 cents next year from its $8.8 million investment in Classwell Learning Group, a closely held online education company.

MP3.com Inc. fell $1.6875 to $6.1875, continuing its fall since a federal judge ruled Wednesday that the online music distributor violated copyrights on CDs sold by Seagram Co.'s Universal Music Group and said MP3.com must pay damages to Universal.

Overseas, Japan's Nikkei stock average fell 0.60 percent; Germany's DAX index was down 0.54 percent; Britain's FTSE 100 was down 0.08 percent; and France's CAC-40 was down 0.56 percent.

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