) left investors on Wednesday: that the Finnish telecom giant's sales estimates for 2000 were weaker than expected. But technology stocks overall - and the broader market -- managed to rally anyway as investors reckoned there were just too many other good buys out there after a sustained sell-off. The Dow meanwhile, sank as economically sensitive stocks weakened on concerns a slowing economy could dent their bottom lines.
"We're near a market bottom," Bob Lee, manager of Sentinel:Mid Cap Growth Fund/A, told Standard & Poor's AdvisorInsight. Lee is encouraged by yesterday's late-day rebound, and thinks the market is starting to discount a pickup in the economy.
Lee cautions that the market may be volatile in the near term, but he's optimistic about the long-term, because "the Federal Reserve will get their way, and there won't be a recession."
Analysts are predicting the Fed will cut interest rates again after its surprise half percentage point reduction earlier this month.
"There is a lot of talk that the Fed is going to act again to get the market going," said Guy Truicko, portfolio manager at Unity Management in Garden City, N.Y. "We are waiting for the next cut."
Among heavily traded stocks on Tuesday, Nokia was off 3-26/32 at 39-10/32 while its American counterpart, Motorola Inc. (MOT
), was off 1-1/16 at 20-11/16.
But the session was brighter for AT&T (T
), the No. 1 U.S. long distance company, which rose 2-7/16 to 22-1/2 after Morgan Stanley raised its investment rating on the stock. AT&T is a Dow Jones industrial average stock.
Despite ATamp;T's rise, the Dow lost 48.40 points, or 0.4%, to 10,572.55, as some of its old-line stocks, which had rallied recently on the weakness in tech, gave back some gains.
Diversified conglomerate Minnesota Mining & Manufacturing (MMM
) was off 1-13/16 at 113-7/16 while Procter & Gamble Co. (PG
) eased 1-15/16 at 74-5/8. Both these Dow components are viewed as sensitive to a slowdown in the economy.
Among some of the tech gainers, Internet media company Yahoo! Inc. (YHOO
) rose 2-16/16 to 30-1/8 despite the fact that ABN Amro lowered its investment rating on the stock. Online retailer Amazon.com (AMZN
) was up 1-7/16 to 16-3/8 even though analysts lowered their investment ratings on the stock.
The most heavily traded Nasdaq share was again data networking giant Cisco Systems Inc. (CSCO
), which was up 19/32 to 37-4/32
The tech-heavy Nasdaq composite index was up 45.38 points, or 1.8%, at 2,441.30. The Standard & Poor's 500 index, a broad stocks gauge, was up 4.94 points, or 0.3%, at 1,300.80.
U.S. Treasuries were mixed as tech stocks regained some lost ground.
There is little economic data to guide the fixed income market before Friday's release of the Producer Price Index (PPI), a key gauge of inflation at the wholesale level.
Stocks in the News
Bookseller Barnes & Noble (BKS
) sees lower than expected fourth quarter earnings per share due to weaker than expected holiday sales.
European markets closed mixed. The London Financial Times-Stock Exchange 100 index was off 61.50 points, or 1.00%, at 6,088.10 on some earning and revenue disappointments as well as uncertainty about interest rates following a report that BRC sales were higher in December.
In Germany, the DAX Index was up 8.69 points, or 0.14%, to 6,400.86 following reports German unemployment fell 27,000 in December but the rate rose to 9.3% from 8.9% in November, EuroZone retail sales fell 0.2% in October due to higher oil price.
Meanwhile, France's CAC 40 was off 69.61 points, or 1.21%, at 5,663.19.
In Asia, Japan's Nikkei 225 Index closed off 257.10 points, or 1.85%, at 13,610.51 as Tokyo shares were hammered by concerns of declining export demand following last Friday's worrisome jobs report in the US. Hong Kong's Hang Seng index was up 64.06 points, or 0.41%, to 15,500.59.
President-elect George W. Bush flies to Washington today, where he will undoubtedly face more questions over the disclosure labor secretary nominee Linda Chavez gave ''spending money'' to an illegal immigrant who lived with her: Reuters.
Calling California's two-year experiment in electricity deregulation a "colossal and dangerous failure," Gov. Gray Davis proposed several major steps to reassert the state's control over its power market: NYT
With abortion rights groups preparing a campaign against his confirmation as attorney general, John D. Ashcroft's anti-abortion views are likely to prove central to his political future: Wash Post.
A government guarantee enabling ailing U.S. steelmakers to obtain loans from private lenders is drawing the ire of some who say that by allowing bad businesses to survive the government is only glutting the market and backing loans that will probably never be repaid: WSJ. By Eric Wahlgren