MARKET CLOSE: Stocks rise and fall with Fed decision

Technology stocks rallied ahead of Wednesday's FOMC policy meeting, lost ground after the Fed left rates unchanged and then made a modest rally in late trading. The Nasdaq composite closed up 27 points to 3,165.45.

The Dow Jones industrial average added 27 points to finish at 10,707.60.

Some investors were disappointed the Fed didn't change its bias while reiterating its concerns about a tight labor market and rising energy prices.

"There was enough hope out there that it has put the market on a bit of the defensive," said Barry Hyman, chief investment strategist for Weatherly Securities.

Yahoo! (YHOO) fell $2.31 to $57.13 while eBay (EBAY) and America Online (AOL) lost $1.88 and 46 cents a share, respectively. Amazon.com (AMZN) rose 56 cents to $29.80 and CMGI (CMGI) shed 13 cents to $14.69.

Network Appliance Inc. (Nasdaq: NTAP) fell $20.13 to $76.13 after the network storage provider forecast slower sales growth along with second quarter results.

Verizon Wireless said it will buy Price Communications Corp.'s (NYSE: PR) wireless subsidiary in a stock transaction worth more than $2.06 billion. The deal may be terminated if Verizon (NYSE: VZ) doesn't manage to complete the IPO of its wireless unit by Sept. 30, 2001. Price Communications was down 19 cents to $20.88 and Verizon closed off $1.56 to $54.19.

Covad Communications' (Nasdaq: COVD) shed $1.22 to $4.16 after its said losses for an already disappointing third quarter increased after it announced changes to previously released results.

Drkoop.com (Nasdaq: KOOP) slid 6 cents to 75 cents after it posted a loss of $57.9 million for the third quarter, as the company streamlines and reorganizes.

PETsMART Inc. (Nasdaq: PETM) closed off 75 cents to $3.25 after announcing it would absorb PETsMART.com and its losses.

Among widely held PC stocks, Dell (DELL) dropped 63 cents to $25.19; Gateway (GTW) added 70 cents to $41.65; Compaq (CPQ) lost 19 cents to $26.91 and Apple Computer (AAPL) finished off 38 cents to $19.88.

Intel (INTC) added 56 cents to $41.50. Advanced Micro Devices (AMD) inched up 19 cents to $21.94 and IBM (IBM) trimmed 13 cents to $99.38.

Microsoft (MSFT) finished up $1.25 to $70.06. Oracle (ORCL) rose 50 cents to $28.88 and Sun Microsystems (SUNW) shaved off 6 cents to end at $93.94.