- The Washington Times - Monday, May 23, 2005

NEW YORK (AP) — Surging technology shares prompted more buying on Wall Street yesterday as investors welcomed analyst upgrades and Apple Computer Inc.’s reported talks to use Intel Corp. chips in its computers.

Wall Street was buoyed by the Apple report, as such a change could be the biggest shift in the Mac’s makeup since it came out in 1984 and could make the machines less expensive. Software stocks also received a boost from analysts at Goldman Sachs, who upgraded the entire sector.

However, while many investors remained optimistic after last week’s rally, many remained on the sidelines ahead of the release of the Federal Reserve’s May 3 meeting minutes and the latest reading on the gross domestic product, expected later this week.

“I think these economic stats will be what generates turnover in this market, but for right now, it’s good to see last week’s rally continuing here,” said Brian Williamson, an equity trader with the Boston Company Asset Management.

The Dow Jones Industrial Average rose 51.65, or 0.49 percent, to 10,523.56, its highest level since April 7.

Broader stock indicators also moved higher. The Standard & Poor’s 500 Index was up 4.58, or 0.39 percent, at 1,193.86 for its best close since March 15, and the Nasdaq Composite Index climbed 10.23, or 0.5 percent, to 2,056.65, its highest close since March 10.

It was the seventh straight gain for the Nasdaq, which hadn’t notched seven up sessions in a row since Nov. 1-8. The Dow and S&P; have risen in five of the past six sessions.

Bonds moved higher, with the yield on the 10-year Treasury note falling to 4.07 percent, down from 4.13 percent late Friday. The dollar fell against most major currencies, while gold prices headed higher.

The good mood helped stocks overcome a surge in oil prices — a barrel of light crude rose 51 cents to settle at $49.16 on the New York Mercantile Exchange.

Volume was light in stock trading — a sign there is still money on the sidelines that has not yet been invested. But the fact that the stock market failed to sell off Friday after the four previous sessions’ gains helped renew confidence in the market despite a lack of economic news.

“I think this is a great show of resiliency in the marketplace,” said Michael Palazzi, managing director of equity trading at SG Cowen Securities. “I don’t think that people are sitting there thinking that this is the start of a real bullish run higher, but to get up to these levels and hold here is a good sign.”

Advancing issues outnumbered decliners by nearly 7 to 4 on the New York Stock Exchange, where volume came to 1.27 billion shares.

compared with 1.28 billion traded on Friday.

The Russell 2000 index of smaller companies was up 3.46, or 0.57 percent, at 612.87.

Overseas, Japan’s Nikkei stock average rose 1.1 percent. In Europe, Britain’s FTSE 100 was up 0.36 percent, France’s CAC-40 gained 0.54 percent for the session, and Germany’s DAX index rose 1.06 percent.

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