MARKET CLOSE: 'Net stocks lift Nasdaq to new record

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Internet stocks picked up ground Wednesday as investors reacted to a flurry of earnings reports from technology bellwethers. The Nasdaq composite gained 20 points to close at a record high of 4,151.27 and the Dow closed off 71 points to 11,489.36.

Microsoft Corp (Nasdaq: MSFT) lost 8 5/16 to 107 after earnings 47 cents a share in its second quarter, but reported that some sales were sluggish.

"(Microsoft) can't help but have some kind of effect on the market," said Pierre Ellis, an economist at Primark Decision Economics. "They are a real bellwether. Even though the profit outlook out there for companies is pretty good, there is still a lot of uncertainty about whether interest rates will be heading higher."

Economic data on housing starts showed that December finished off the best year in the home-building market since 1986. The Commerce Department said housing starts jumped 7.1 percent to a 1.71 million annual rate last month, rebounding from a 2.7 percent decline to a 1.59-million rate the month before.

Oracle Corp. (ORCL) closed up 1 1/2 to 57 1/8 and Sun Microsystems Inc. (SUNW) closed up 2 3/16 to 82 15/16.

Apple Computer Inc. (AAPL) closed up 2 5/8 to 106 9/16 ahead of its earnings report. Dell Computer Corp. (DELL) gained 1/2 to 42 9/16 while Compaq Computer Corp. (CPQ) and Gateway Inc. (GTW) closed off 1 3/16 and 1 13/16 a share, respectively.

Intel Corp. (Nasdaq: INTC) shed 2 1/16 after its recent earnings successes and Advanced Micro Devices (NYSE: AMD) closed up 5/16 to 39 5/16 ahead of its earnings report. IBM (NYSE: IBM), which also will release earnings, closed down 1/4 to 115 1/2.

Among widely held Internet stocks, Yahoo! Inc. (YHOO) shot up 22 13/16 to 364; America Online Inc. (AOL) hustled up 2 3/4 to 64; Lycos Inc. (LCOS) tacked on 5 1/4 to 77 11/16; Amazon.com Inc. (AMZN) moved up 2 11/16 to 66 13/16 and eBay Inc. (EBAY) finished up 4 1/4 to 143 3/4.

Citrix Systems Inc. (Nasdaq: CTXS) closed up 2 7/16 to 155 after it topped estimates Wednesday with fourth quarter operating earnings of $37.7 million, or 38 cents a share. The company also announced series of products and a 2-for-1 stock split.

Spyglass Inc. (Nasdaq: SPYG) fell 3 7/8 to 48 5/8 after it said it lost 4 cents a share in its first quarter fiscal 2000, scraping by First Call's predicted loss of 5 cents a share.

Web brokers E*Trade Group (Nasdaq: EGRP) lost 1 3/4 to 26 3/16 and DLJdirect (NYSE: DIR) gained 7/16 to 13 3/4 after they reported upside surprises, while Knight-Trimark (Nasdaq: NITE) lost 1/4 to 38 3/4 after it reported a better-than-expected profit.

Cisco Systems, Inc. (Nasdaq: CSCO) rose 5/16 to 112 5/16 after it said it will buy privately-held Altiga Networks and Compatible Systems for stock worth $567 million to enhance its New World VPN (Virtual Private Networks). Lucent Technologies (NYSE: LU) rose 5/8 to 51 1/8 and 3Com Corp. (COMS) closed off 1 3/8 to 47 13/16.

Exabyte Corp. (Nasdaq: EXBT) inched up 1/8 to 7 7/8 after it said net loss for its fourth quarter was 53 cents a share, right on target with First Call's consensus estimate.