Chip and telecommunications stocks pushed the Nasdaq up 119 points to a record close of 4,696.57 Tuesday while the Dow Jones industrial average moved up 90 points to 10128.31.
Despite the prospects of more interest-rate hikes in the near future, investors decided to jump back into some beaten down tech sectors.
"The tech sector is back in the lead again," said John Davidson, chief investment officer at Orbitex Management.
Semiconductor stocks were on fire Tuesday, led by Rambus Inc. (RMBS) which closed up 60 5/8 to 301 5/8 after some positive comments from analysts at the Robertson Stephens technology conference in San Francisco.
Altera Corp. (ALTR) scampered up 8 1/4 to 79 3/4 and Micron Technology Inc. (MU) added 19 5/8 to 97 11/16 after analysts raised their 12-month price targets on the stocks. Intel Corp. (INTC) inched up 5/8 to 113 and Advanced Micro Devices Inc. (AMD) closed up 1 3/8 to 39 1/8.
3Com Corp. (COMS) rocketed up 18 15/16 to 98 ahead of the Palm Inc. initial public offering. 3Com plans to distribute shares of Palm about six months after the IPO.
Cisco Systems Inc. (CSCO) rose 1 5/8 to 132 3/16 and Lucent Technologies Inc. (LU) closed up 1 1/2 to 59 1/2.
America Online Inc. (NYSE: AOL) and Time Warner (NYSE: TWX) pledged Tuesday to open their cable lines to other Internet service providers in a move that could help gain regulatory approval for their planned merger. AOL shares closed off 1 5/8 to 59 and Time Warner slid 1 5/16 to 85 3/8.
Yahoo! Inc. (YHOO) closed off 2 1/4 to 159 11/16 while Lycos Inc. (LCOS) and Amazon.com Inc. (AMZN) moved up 1 3/8 and 3 1/8 a share, respectively. eBay Inc. (EBAY) fell 1 11/16 to 143 3/8 and Excite@Home Corp. (ATHM) gained 15/16 to 34 5/16.
Internet incubator Safeguard Scientifics Inc. (NYSE: SFE) rose 30 7/16 to 174 5/16 after the company said it will split its stock and offer another 10 million shares to the public. The company also named Gerald Blitstein chief financial officer.
Initial public offerings were popular Tuesday as Niku Corp. (Nasdaq: NIKU) made a soared up 45 to 69 in its debut. Internet advertising firm Avenue A (Nasdaq: AVEA) rallied up 48 to 72 and marketing software company net.Genesis (Nasdaq: NTGX) picked up 38 13/16 to 56 13/16.
Among widely held PC stocks, Dell Computer Corp. (DELL) shaved off 3/16 to 40 13/16; Compaq Computer Corp. (CPQ) lost 5/8 to 24 7/8; Gateway Inc. (GTW) slipped 3/4 to 68 3/4 and Apple Computer Inc. (AAPL) closed up 1 3/8 to 114 5/8.
Microsoft Corp. (MSFT) shed 2 3/16 to 89 3/8 and Oracle Corp. (ORCL) shot up 5 5/8 to 74 1/4.