Techs surge; Dow breaks 10,000
Optimism about technology stocks and two better-than-expected economic reports combine to push the Dow and Nasdaq beyond the 10,000 and 2,000 marks, respectively.
Technology stocks began gaining early in the day but got an additional boost as the broader markets gained on two economic reports. The Dow Jones industrial average picked up 220.45 points, or more than 2 percent, to 10,114.29, breaking the 10,000 mark for the first time since Sept. 6. The Nasdaq added 83.74, or more than 4 percent, to 2,046.84.
According to outplacement company Challenger, Gray & Christmas, announced job cuts totaled 181,412 last month, down 25 percent from October, when companies announced 242,192 layoffs. Although layoff announcements have easily surpassed the combined totals for 1999 and 2000, the number of layoffs is declining.
Wall Street also got a better-than-expected report on manufacturing. The National Association of Purchasing Managers' survey of the services sector rose to 51.3 in November from 40.6 in October, well above estimates.
"The two reports support the notion that the worst of the downturn has passed," said Merrill Lynch analyst Martin Mauro.
According to Mauro, the manufacturing and layoff data show the economy "is not spiraling downward." He said he still expected the Federal Reserve to cut interest rates by a quarter point next Tuesday.
The upbeat economic reports added fuel to tech stocks, which were already rallying.
Tech bellwethers gained across the board. Shares of Cisco Systems were the most active Nasdaq issue for the second consecutive day, up $1.02, nearly 5 percent, to $21.54. On Tuesday, Cisco CEO John Chambers gave an upbeat presentation at the company's analyst conference.
Oracle also made strong gains, adding $1.57 to $15.37. CEO Larry Ellison said Tuesday that the company expected growth to return next year. Ellison also said Oracle donated software for U.S. national security.
AOL Time Warner was heavily traded as well, gaining $1.08 to $35.83. The company announced management changes, including the appointment of Richard Parsons as the new CEO. Current CEO Gerald Levin is retiring.
Intel added $1.75 to $34.61, and Sun Microsystems gained 83 cents to $14.54. Both companies are scheduled to give midquarter financial updates Thursday.
Among the CNET technology indexes, networking stocks showed strong gains, along with e-tailers, which benefited from Amazon.com's gains. Semiconductor and chip equipment stocks also moved up.
Staff and Reuters contributed to this report.