Technology Issues Lead Stock Market Rebound
Technology stocks shook off the doldrums Tuesday and once again led the market higher following some good third-quarter corporate earnings reports.
The Dow Jones industrial average rose 11.56 points to 4,795.94.
Declining issues and advances were just about equal on the New York Stock Exchange. Volume on the floor of the Big Board came to 356.38 million shares, up from 299.50 million in the previous session.
Stocks reversed an early downward course set by mixed interpretations of some corporate earnings reports.
As stock analysts looked more closely at the earnings reports, however, opinion changed.
Overall, technology issues, which have taken a beating over the past month, rallied sharply following good earnings announcements from Sun Microsystems and Compaq Computer.
The rally in technology issues pulled up the Nasdaq 17.31 to 1,035.44.
Some of the stocks that moved substantially or traded heavily:
NYSE
Compaq, up 3 to 51-3/8
The leading maker of personal computers, said it earned $245 million in the third quarter, a 22 percent jump that is slower than previous growth. But the 89-cent per share profit fell in line with analysts’ expectations.
General Motors, unchanged at 46-1/2
The nation’s biggest automaker said its third-quarter earnings rose 16.4 percent from a year ago. GM earned $642 million, or 42 cents a share, for the July-September quarter compared with $552 million, or 40 cents a share, a year ago.
IBM, up 2-7/8 at 96-7/8
The company announced earnings, which included its first loss in two years after taking a special charge to help pay for Lotus Development Corp. The $1.8 billion charge led the company to post a loss of $538 million, or 96 cents a share. Still, after analysts looked more closely at the report, the stock, which had spent much of the day lower, rallied amid hopes for a stronger fourth quarter, analysts said.
Eastman Kodak, up 2-1/2 at 59-5/8
The company said third-quarter profit jumped 75 percent compared to a year ago, driven by steady sales of film and photographic paper and favorable currency exchange rates. Kodak earned $338 million, or 99 cents a share on revenue of $3.87 billion in the third quarter. A year ago, it earned $193 million.
NASDAQ
Sun Microsystems, up 9-1/4 to 67-7/8
The company said after the close of trading on Monday that fiscal first-quarter earnings were 85 cents a share vs. 40 cents in the same three months last year.
Microsoft, up 4-3/8 at 91-1/8
After the close of trading, the company announced fiscal first-quarter earnings of 78 cents a share vs 51 cents in the same three months last year, beating analysts’ expectations.