MARKET CLOSE: Techs end week with holiday cheer

Pre-Christmas bargain hunting for big names carried technology stocks higher Friday.

The tech-heavy Nasdaq Composite Index rose 176.83 to 2,516.95. The S&P 500 rose 31.1 to 1,305.96. The Dow Jones Industrial Average gained 148.27 to 10,635.56.

Inter@ctive Week's @100 Index advanced 93.15 to 2,729.75.

Expectations that the Federal Reserve will cut interest rates, and thus trim corporate America's borrowing costs possibly by early next year, injected some cheer into a Nasdaq market.

"This is our brief Santa Claus rally," said Scott Bleier, chief investment strategist at New York-based brokerage Prime Charter Ltd. "We think this is more of a bounce from the hammering we've gotten up to Wednesday."

Friday's 7.6 percent gain represents the best Nasdaq advance in recent memory for the final trading day before Christmas. Pre-Christmas sessions over the previous 16 years saw an average gain of 0.3 percent for the Nasdaq.

However, the index remained down 5.1 percent from the previous week's close. Friday's gains ended a brutal week in which Nasdaq hit a 21-month low, as techs were hit especially hard by earnings warnings and signs of a slowing economy.

IBM (NYSE: IBM) shares advanced 7.4375 to 89 Friday after an analyst said it's "back-up the truck time" on IBM shares, which have suffered from rumors of a pending profit warning.

Other tech bellwethers picked up ground. Cisco Systems (Nasdaq: CSCO) gained 2.625 to 41.5, Intel (Nasdaq: INTC) dipped 0.1875 to 32.9375, Oracle (Nasdaq: ORCL) rose 2.375 to 31.875 and Microsoft (Nasdaq: MSFT) jumped 3 to 46.375.

Documentum (Nasdaq: DCTM) rose 7.625 to 47.75 Friday after reaffirming financial guidance for 2001 after Thursday's bell.

Harmonic Inc.'s (Nasdaq: HLIT) shares fell 0.84375 to 5.96875 on Friday after the company said its fourth-quarter loss may be three times as large as analysts' estimates due to slumping market conditions.

Reports from Media Metrix and Goldman Sachs Friday indicated that smaller e-tailers may be getting a lump of coal for poor performance this holiday season. Amazon.com (Nasdaq: AMZN) rose 0.375 to 15.5625.

Despite topping earnings numbers for its third quarter, shares of Cognos Inc. (Nasdaq: COGN) dropped 7.8125 to 19.25 on disappointing sales numbers and analyst downgrades.