Chip-stock buying gives Nasdaq a rise
Investors give the tech-heavy Nasdaq a boost as they swoop in to buy semiconductor stocks ahead of Intel's midquarter conference call.
The Dow Jones industrial average rose 20.50 points to 11,090.74, and the Nasdaq was up 46.27 points to 2,264 at midday. The CNET semiconductor and semiconductor capital equipment indexes jumped 7 percent and 6 percent, respectively.
On the economic front, the number of new applications for state jobless benefits rose to its highest level in more than eight years, the government said Thursday in a report showing a job market that continues to soften. Initial claims for state unemployment insurance benefits rose to 432,000 in the Memorial Day-shortened week ended June 2 from 419,000 in the prior week, the Labor Department said.
Intel was the most actively traded stock on the Nasdaq, with shares up $1.34 to $31.16. The company is hosting a midquarter update with analysts after the market closes. The meeting comes amid reports of a sluggish PC market. Research company IDC said Wednesday that for the first time, U.S. PC shipments have fallen from the prior year.
Intel rival Advanced Micro Devices also gained. The company said Wednesday that it expects modest revenue growth in 2001. AMD executives, speaking at a press conference in Tokyo, said there is increasing reason to believe the PC market is stabilizing and will return to normal in the fourth quarter of this year. AMD was up $1.91 to $30.28.
Corning sank 12 cents to $19.40 on news it will delay construction of its Oklahoma City optical fiber manufacturing facility as well as the expansion rate of its Concord, N.C., plant. The company, the world's largest fiber-optic cable manufacturer, said it was making the adjustments to match its manufacturing capacity growth and capital-spending rate with current market conditions.
National Semiconductor reported a wider-than-expected fourth-quarter loss, but said it may be seeing signs of a turnaround. The company posted a loss of $44.4 million, or 26 cents a share, compared with net income of $134.2 million, or 68 cents per share, in the same period a year ago. Analysts were expecting National Semiconductor to report a loss of 3 cents per share. Shares rose $3.07 to $31.04 on the news.
Broadcom warned Wall Street that second-quarter revenue will fall below previous expectations. CEO Henry Nicholas said in a Thursday conference call that third-quarter revenue will be flat with the second quarter. However, Nicholas also said order cancellations and delays have slowed down, suggesting the company may recover in the fourth quarter. Shares rose $4.67 to $40.24.
Consumer electronics retailer Best Buy said first-quarter sales rose 25 percent, adding that earnings for the quarter would be in line with Wall Street estimates. Best Buy said total sales for the quarter were $3.69 billion, up from $2.96 billion a year earlier. New store openings and the inclusion of sales from Musicland Group stores helped results. Best Buy shares were up $2.38 to $61.14.
Among leading volume movers, Cisco Systems gained $1.06 to $21.82; Microsoft rose $1.29 to $73.65; Nortel Networks was unchanged at $13.13; and Oracle rose 33 cents to $17.33.
Staff and Reuters contributed to this report.