High-Tech Comeback Gives Market A Boost

Technology shares put on a stunning comeback Wednesday, lifting the Dow Jones industrial average slightly and sending the Nasdaq Stock Market index to its biggest one-day gain in nearly six weeks.

The Dow rose 4.53 points to 6,880.70, led by IBM, which was the biggest gainer of the Dow 30 and contributed more than 13 points to the index.

Technology gains were most clearly seen in the Nasdaq Composite Index. It rose 21.02 points to 1,269.08, but still was well shy of its Jan. 22 high of 1,388.06.

Technology stocks have been beaten down in recent weeks amid questions over whether profits would justify high prices.

But the Federal Reserve’s interest-rate boost Tuesday made banks and stocks in companies that ride the ups and downs of the economy less attractive. Suddenly technology issues looked cheap.

“With all the cash still to be invested (before the end of the quarter) money managers are seeking out stocks that have been depressed,” said Dan Ascani, president and research director at Global Market Strategists Inc. in Gainesville, Ga.

Advancing issues outnumbered decliners by a 10-to-9 margin on the New York Stock Exchange, where volume totaled 487.33 million shares as of 4 p.m., vs. 480.39 million in the previous session.

Some of the stocks that moved substantially or traded heavily Wednesday:

NYSE

Motorola, up 2-3/16 to 60-9/16.

Two Japanese cellular service providers, DDI Corp. and Nippon Ido Tsushin, selected Motorola’s Cellular Infrastructure Group to set up new digital calling networks in a deal that analysts said was guaranteed to be highly lucrative.

Foodbrands America Inc., up 7-3/8 at 23-1/8.

IBP Inc., up 1/2 at 25-1/2.

IBP, the world’s largest producer of beef and pork, will expand into the frozen-food industry with its $640 million acquisition of Foodbrands.

American States Financial Corp. rose 2-3/4 to 35.

The company said it is exploring its sale and hired Goldman Sachs & Co. as financial adviser. American States sells insurance primarily to small- and medium-size businesses in Midwestern and Pacific Northwest states through independent agents.

NASDAQ

Cisco Systems Inc., up 4-1/2 at 52-3/8.

The San Jose, Calif., maker of Internet networking systems said Wednesday it had acquired privately held Telesend in a stock swap.

Rally’s Hamburgers Inc. up 5/8 to 4-1/16

Checkers Drive-In Restaurants Inc. down 1/16 to 1-25/32.

Rally’s agreed to be acquired by Checkers for about $174 million in stock. Under the agreement, each share of Rally’s common would be converted into three shares of Checkers common.