Blue-chip and technology stocks moved higher Tuesday, buoyed by a better-than-expected consumer confidence report and bargain-basement prices for sector leaders.
The Nasdaq composite picked up 54 points to finish at 1,972.28, while the Dow Jones industrial average shot up 260 points to end at 9,947.54.
"Generally, consumer confidence runs a bit ahead of the economy. When you see improved consumer confidence, you are going to see some additional spending," Joseph Barthel, chief investment strategist at brokerage Fahnestock & Co. told Reuters. "So possibly the lows we have seen in tech stocks or even recently some larger-cap names may improve come the third quarter."
U.S. consumer confidence--a broad gauge of consumer attitudes--rose steeply in March, triggered by an improvement in the economic outlook for the next six months and better job prospects, the Conference Board said on Tuesday. The index rose to 117 in March from an upwardly revised February reading of 109.2, surprising analysts who had forecast a drop to 104.5.
However, a report on durable goods--which indicates consumers' appetite for expensive manufactured products ranging from refrigerators to airplanes--showed a modest drop in February after a steep decline the previous month. The number fell 0.2 percent in February to a seasonally adjusted $199.20 billion. The data were weaker than expected, confirming a slowing in the U.S. economy and giving more hope that Greenspan would lower interest rates yet again.
The mixed data likely means the Federal Reserve will resist the temptation to cut interest rates before its next meeting in May, analysts said.
Intel (Nasdaq: INTC) moved up $1.06 to $29.38. Advanced Micro Devices (NYSE: AMD) picked up 97 cents to $29.71 and IBM (NYSE: IBM) finished up $4.10 to $99.50.
Vitesse Semiconductor (Nasdaq: VTSS) tumbled $4.88 to $29.06 after it lowered estimates for the second time in three weeks. Rival TranSwitch (Nasdaq: TXCC) lost $3.75 to $15.13 following a profit warning. PMC-Sierra (Nasdaq: PMCS) trimmed 86 cents to $31.40, and Conexant (Nasdaq: CNXT) lost 44 cents to close at $10.06.
Yahoo (Nasdaq: YHOO) moved up $1.38 to $15.56. Amazon.com (Nasdaq: AMZN) and eBay (Nasdaq: EBAY) rose 66 cents and $1.56 a share, respectively, while America Online Time Warner (NYSE: AOL) gained $2.11 to $43.
The cuts at mobile phone makers also continued as Ericsson (Nasdaq: ERICY), up 88 cents to $6.72, and Nokia (NYSE: NOK), up 26 cents to $27.34, each announced a new round of layoffs.
Cisco Systems (Nasdaq: CSCO) inched up 25 cents to $18.13. Nortel Networks (NYSE: NT) trimmed 16 cents to $16.76, and Lucent Technologies (NYSE: LU) closed off 29 cents to $11.70.
Microsoft (Nasdaq: MSFT) tacked on $2.19 to $58.25. Oracle (Nasdaq: ORCL) picked up 96 cents to $16.65, and Sun Microsystems (Nasdaq: SUNW) moved up 17 cents to finish at $17.41.
Among widely held PC stocks, Dell (Nasdaq: DELL) jumped $1.31 to $27, Gateway (NYSE: GTW) inched up 3 cents to $17, Apple Computer (Nasdaq: AAPL) gained $1.09 to $22.87 and Compaq (NYSE: CPQ) rose 38 cents to end at $20.28.
ZDII staff and Reuters contributed to this roundup.