A double dose of positive economic news inspired investors Thursday as the Dow Jones industrial average stormed up 228 points to 10,622.53 while the tech-laden Nasdaq composite rose 73 points to finish at 2,875.44.
Concerns over possible interest-rate hikes were put on hold after the U.S. Bureau of Labor Statistics said the Employment Cost Index rose 0.8 percent last month. Economists polled by Reuters expected the ECI to rise by 0.9 percent. Third-quarter Gross Domestic Product growth came in at 4.8 percent, compared to an expected rise of 4.7 percent.
"It's a very, very euphoric reaction to the labor numbers,'' said Doug Myers, the vice president of equity trading at Wachovia Securities. "The shark siting is past. Everyone's jumping back in the water."
Technology stocks across the board made the most of the reprieve from interest-rate angst.
Dell Computer Corp. (DELL) picked up 1/8 to 38 1/2. Compaq Computer Corp. (CPQ) trimmed 1/4 to 18 13/16 but Apple Computer Inc. (AAPL) and Gateway Inc. (GTW) rose 1 1/2 and 1 3/8 a share, respectively.
"Finally we're having a good day," said Ken Tower, a technical analyst at UST Securities. "But you need a bunch of todays or a double-today -- that would suggest that investors have sort of turned the corner."
Amazon.com Inc. (AMZN) fell 4 13/16 to 71 1/8 after the stock was downgraded by several analysts. Competitor Barnesandnoble.com (BNBN) gained 5/16 to 20 after ittopped estimates Thursday with a smaller-than-expected loss.
America Online Inc. (AOL) added 2 9/16 to 122 3/16 while Yahoo! Inc. (YHOO) and Excite@Home Corp. (ATHM) closed up 13/16 and 3/16 a share, respectively. Lycos Inc. (LCOS) fell 9/16 to 52 11/16 and Infoseek Corp. (SEEK) closed up 11/16 to 28 7/8 ahead of its earnings report.
iXL Enterprises, Inc. (IIXL) closed up 2 1/8 to 43 3/4 after it posted a third quarter loss of 20 cents a share Thursday, far better than First Call's expected loss of 35 cents a share. Strong demand for its Internet consulting services and organic growth drove the quarter.
MCI Worldcom Inc. (WCOM) shot up 6 1/16 to 83 5/8 after announcing third-quarter earnings of $1.1 billion, or 56 cents a share, beating First Call's prediction of 54 cents a share.
StorageTek (NYSE: STK) inched up 3/8 to 15 after it missed lowered estimates again. The network storage company said it will cut 1,500 to 1,750 jobs, giving it an annual savings of $150 million. Storage Tek announced the restructuring as it reported third quarter earnings of $4.7 million, or 5 cents a share, missing First Call's prediction of 8 cents a share
Harmonic Inc. (Nasdaq: HLIT) tumbled 7 3/8 to 52 1/2 after it agreed to buy the Divicom business of C-Cube Microsystems Inc. for about $1.47 billion in stock, saying it would make Harmonic stronger in delivering video, voice and data over high-speed networks.
Microsoft Corp. (MSFT) closed off 15/16 to 89 15/16. Oracle Corp. (ORCL) tacked on 1 1/16 to 45 7/8 and Sun Microsystems Inc. (SUNW) rallied up 6 to 98 5/8.
International Business Machines Corp. (IBM) moved up 1 7/8 to 94 7/8 while Intel Corp. (INTC) and Advanced Micro Devices Inc. (AMD) shot up 2 3/4 and 9/16 a share, respectively.