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MARKET CLOSE: Techs rally after Fed leaves rates unchanged

Technology stocks made sharp gains Wednesday after the FOMC said it would leave interest rates unchanged. The Nasdaq composite closed up 81 points to 3,940.34 while the Dow Jones industrial average gained 23 points to end at 10,527.79.

The Dow was actually on its way to triple-digit gains ahead of the Fed's announcement.

"It is about what everybody had anticipated," said Bill Meehan, chief market analyst at Cantor Fitzgerald. "I wouldn't be surprised after we get this little bit of a pop that we pull back a little. We had a big strong move into the announcement. (The warning) means people are going to start to worry about what the Fed is going to do in August."

WorldCom (WCOM) charged up 4 7/8 to 44 9/16 while Sprint (FON) fell 5 5/8 to 52 3/4 one day after the Justice Department said it would sue to block the companies' $120 billion merger.

Hewlett-Packard (HWP) shot up 3 11/16 to 123 11/16 after Lehman Brothers identified it as one of 10 stocks that could outperform the rest of the market this year.

Dell (DELL) shares gained 1 3/16 to 49 while Apple (AAPL) and Gateway (GTW) rose 2 11/16 and 1/4 a share, respectively. Compaq (CPQ) closed up 7/16 to 28 5/16.

Yahoo! (Nasdaq: YHOO) shaved off 2 3/8 to 123 9/16 after announcing it will acquire privately held eGroups, an email group communication service, in a stock swap valued at $428 million.

Amazon (Nasdaq: AMZN) CEO Jeff Bezos reiterated the company's profit mantra Wednesday at a PC Expo keynote: Profits matter, but it's time to invest in the business. Its shares closed up 1 3/8 to 37 7/8.

America Online (AOL) lost 3/4 to 51 1/18. Lycos (LCOS) rose 15/16 to 56 15/16 and eBay (EBAY) closed off 7/16 to 52.

Genuity (Nasdaq: GENU) got off to a disastrous start, falling 1 19/32, or 15 percent, to 9 13/32 in its initial public offering.

Oracle (ORCL) picked up 11/16 to 82 15/16 while Sun Microsystems (SUNW) and Microsoft (MSFT) added 2 3/4 and 1/8 a share, respectively.

Qualcomm (Nasdaq: QCOM) fell 1/8 to 63 9/16 after it announced that it may experience lower order levels for its chipsets in the fourth quarter.

Intel (INTC) moved up 1 to 132 3/8 while IBM (IBM) and Advanced Micro Devices (AMD) fell 23/32 and 4 3/8 a share, respectively.