Market Close: Fed announcement sends stocks skyward

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The Federal Reserve Board's decision to raise interest rates by one-quarter of a percent and move toward a "neutral" bias ignited Wall Street in late trading Wednesday. The Nasdaq composite stormed up 41 points to a record high of 2,686.41 while the Dow shot up 155 points.

Everyone was expecting the rate increase, but few predicted the Fed would publicly announce its newly adopted neutral position. Now, those worries of subsequent rate increases later this year seem far less likely.

"That's good, it's what we expected," said James Volk, co-director of institutional trading at D.A. Davidson Co. "You will get a little sigh of relief bounce and then you could get a normal pullback over the next few days. This gives people the opportunity to 'window-dress' for the end of the quarter."

No sector benefited more from the Fed announcement than Internet stocks.

After spending much of the day in the red, America Online Inc. (AOL) shares picked up 4 1/2 to 110 1/2 after announcing a marketing pact with eMachines Inc. CMGI Inc. (CMGI) gained 3 3/4 to 114 1/16 and Amazon.com Inc. (AMZN) moved up 9 1/16 to 125 1/8.

Yahoo! Inc. (YHOO) soared up 12 1/4 to 172 1/2 while Excite At Home Corp. (ATHM) and Infoseek Corp. (SEEK) gained 2 and 1 11/16 a share, respectively. Lycos Inc. (LCOS) bucked the trend, falling 3 1/16 to 91 7/8.

Juniper Networks Inc. (JNPR) exploded up another 33 1/2 to 149.

Network Plus (NPLS) shot up 4 7/8 to 20 7/8 in its initial public offering while ShowCase Corp. (SHWC) fell 3/8 to 8 5/8 in its debut.

Qwest Communications International Inc. (QWST) picked up 3/16 to 33 1/16 after Frontier Corp. (FRO) agreed to discuss its $12.3 billion takeover offer. Frontier shares closed up 7/8 to 59.

Among widely held chip and chip-equipment stocks, Intel Corp. (INTC) inched up 1/4 to 59 1/2; Advanced Micro Devices Inc. (AMD) lost 1/16 to 18; Applied Materials Inc. (AMAT) rallied up 4 _ to 73 7/8; Novellus Systems Inc. (NVLS) tacked on 2 1/4 to 68 1/4 and Lam Research Corp. (LRCX) added 1 11/16 to 46 11/16.

Dell Computer Corp. (DELL) edged up 5/16 to 37. Compaq Computer Corp. (CPQ) and Apple Computer Inc. (AAPL) rose 5/16 and 15/16 a share, respectively, while Gateway Inc. (GTW) lost 13/16 to 59.

Microsoft Corp. (MSFT) added 2 3/16 to 90 3/16 ahead of a conference call with analysts. Oracle Corp. (ORCL) closed unchanged at 37 1/8 and Sun Microsystems Inc. (SUNW) gained 2 3/8 to 68 7/8.