Tech Industry

MARKET CLOSE: Economic data elates Wall Street

A modest increase in July's Producer Price Index ignited Wall Street Friday as the Dow Jones industrial average surged up 184 points to 10,973.65 while the Nasdaq rose 86 points to close at 2,635.14, the fourth-largest, single-day gain in its history.

The Labor Department reported the PPI gained 0.2 percent in July after falling 0.1 percent in June. Though the report sends out signals that inflation is benign despite the strong economy, consensus on the street seems to be that another quarter point raise on August 24 is a sure thing.

"There is no inflation. The Fed won't be doing more than a 25-basis-point rate hike, and that's it for the year," said Arthur Hogan, chief market analyst at Jefferies & Co. "This (Dow) is going to 12,000 ... by the end of the year."

The news was especially reassuring to Internet investors.

Yahoo! Inc. (YHOO) moved up 4 7/16 to 132 13/16 while Amazon.com Inc. (AMZN) and America Online Inc. (AOL) added 5 11/16 and 4 a share, respectively.

Excite@Home Corp. (ATHM) fell 2 1/16 to 37 but Lycos Inc. (LCOS) and Infoseek Corp. (SEEK) plowed up 2 15/16 and 1 7/16 a share, respectively.

Quest Software (QSFT) found footing on the unstable IPO market, closing up 33 to 47 in its debut. Active Software (ASWX) managed to pick up 3 to 14 in its first trading day.

Lucent Technologies (LU) tacked on 2 1/8 to 65 7/8 after it agreed to buy Xedia Corporation, a privately held developer of Internet access routers for wide area networks, in a deal valued at $246 million. Cisco Systems Inc. (CSCO) moved up 1 7/8 to 63 9/16 and 3Com Corp. (COMS) closed up 1 3/16 to 24 1/4.

Merrill Lynch said chips were looking good, prompting Xilinx Inc. (XLNX) to saunter up 6 3/16 to 73 9/16 while Altera Corp. (ALTR) and Lattice Semiconductor Corp. (LSCC) closed up 3 and 2 5/16 a share, respectively.

Dell Computer Corp. (DELL) gained 1 3/16 to 41 7/16. Compaq Computer Corp. (CPQ) rose 5/16 to 23 1/16 and Apple Computer Inc. (AAPL) inched up 1/16 to 60 1/16. Gateway Inc. (GTW) lost 3/4 to close at 81 3/4.

Intel Corp. (INTC) shot up 3 13/16 to 79 3/4, building on its 52-week high. Advanced Micro Devices Inc. (AMD) picked up 7/16 to 18 15/16 and IBM Corp. (IBM) finished up 2 7/8 to 123 1/2.

Microsoft Corp. (MSFT) ended up 2 15/16 to 84 11/16 and Oracle Corp. (ORCL) gained 3 1/8 to 38 5/8.