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Markets up after earlier zigzag

Stocks close higher after teetering between gaining and losing ground in earlier trading.

Stocks surged to close higher today after teetering between gaining and losing ground in earlier trading following the Federal Reserve's cut of key interest rates by a quarter percent.

The Dow Jones Industrial Average rose 54.83 points or .61 percent, to close at 9,041.11. The technology-heavy Nasdaq Composite Index also jumped, rising 18.92 points or just over 1 percent to 1,897.44.

Online book and music retailer Amazon.com, which announced yesterday that it would begin to sell videos as well, continued to surge today. The stock climbed 10.44 percent to 164, well above its 52-week high of 154.25.

Web portal and browser software maker Netscape Communications also surged with good news on several fronts. The company announced today that it will acquire NewHoo, a small Internet directory.

But what may be driving the company's stock to close more than 34 percent higher are talks the firm is in with America Online to possibly make Netscape's Navigator the preferred AOL browser. The company's shares jumped 10 points to 39.25. The stock has traded as high as 44.5 and as low as 14.88 during the past 52 weeks. With 32 million shares changing hands today, shares of Netscape were the most actively traded issue today on the Nasdaq market.

But not all news was rosy. Shares of computer chipmaker Applied Materials dipped today after influential brokerage firm Morgan Stanley Dean Witter downgraded the company's outlook to "neutral" from "outperform" despite its strong earnings report yesterday. The stock fell 1.17 percent to 36.93. It has traded as high as 39.61 and as low as 21.56 during the past 52 weeks.