U.S. stocks vault as tech shares soar
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U.S. stocks vault as tech shares soar
CBS MarketWatch
U.S. stocks vault as tech shares soar
Monday July 7, 10:25 am ET
By Julie Rannazzisi
NEW YORK (CBS.MW) -- U.S. stocks flexed their muscles Monday morning as technology stocks shot higher, sending the Nasdaq above the 1,700 mark for the first time since May 2002.
The market advanced in the face of profit warnings from the likes of BMC Software and Schering-Plough as investors bet that second-quarter results would come in ahead of expectations since the pace of negative pre-announcements has been slower than usual.
The Dow Jones Industrial Average (CBOT^DJINews) zoomed 170 points, or 1.9 percent, to 9,242. All of the Dow's 30 components headed higher, spearheaded by the shares of Intel, Microsoft, General Electric and J.P. Morgan Chase.
The Nasdaq Composite (NasdaqSC^IXICNews) rallied 42 points, or 2.6 percent, to 1,706 and the Nasdaq 100 Index (NasdaqSC^NDXNews) ran up 35 points, or 2.8 percent, to 1,266.
Strategists believe the second-quarter reporting season, which begins in earnest next week, will be crucial in determining whether the nearly four-month old rally in equities can continue or whether it has run its course.
Wall Street analysts expect second-quarter earnings to grow 5.4 percent year-over-year. Two Dow components will unearth their results this week: Alcoa and General Electric.
The Standard & Poor's 500 Index (CBOE^SPXNews) raced 1.8 percent higher while the Russell 2000 Index (CBOE^RUTNews) of small-capitalization stocks advanced 1.6 percent.
Volume came in at 274 million on the NYSE and at 410 million on the Nasdaq Stock Market. Winners obliterated losers by 22 to 7 on the NYSE and by 22 to 6 on the Nasdaq.
On the fund flow front, Trim Tabs estimated that all equity funds got inflows of $2.5 billion in the week ending July 2, compared with outflows of $1.5 billion in the prior week. And equity funds that invest primarily in U.S. stocks had inflows of $400 million vs. outflows of $200 million during the prior week.
Finally, Trim Tabs estimated that bond funds received an infusion of $1.8 billion for the third consecutive week.
Schering, Redback and BMC trip on warnings
Blaming competitive pressures on its major products, Schering (NYSESGPNews) warned that second-quarter and second-half earnings would fall short of current projections. Shares of the drugmaker slid 4.2 percent.
BMC Software (NYSEBMCNews) eased 6.5 percent after telling investors that its fiscal first-quarter results would fall short of expectations because of delays in purchasing decisions by large customers.
Redback Networks (NasdaqNMRBAKNews) took a 25.3 percent nosedive after telling investors late last Thursday that its second-quarter revenue would come in below expectations due to continued caution by its customers and weakness in Asian markets.
In analyst actions, J.P. Morgan lifted its second-quarter earnings and revenue estimate on Net bellwether Yahoo (NasdaqNMYHOONews) on expectations for solid advertising sales, sending shares 2.3 percent higher
Treasurys struggle
Government bonds slipped, adding to last week's brutal losses as investors continued to flee fixed-income issues amid growing expectations that an economic recovery will take hold in the second half of the year.
The 10-year Treasury note slipped 10/32 to yield (CBOE^TNXNews) 3.695 percent while the 30-year government bond eased 9/32 to yield (CBOE^TYXNews) 4.705 percent.
No economic reports are due out on Monday in a week that will see few releases of significance. Among them: weekly jobless claims, the June producer price index and the University of Michigan's preliminary reading on July consumer sentiment.
In the currency sector, the U.S. dollar rose against its major trading counterparts, climbing 0.1 percent to 118.25 yen while the euro slid 1.2 percent to a 2-month low at $1.1352.
U.S. stocks vault as tech shares soar
Monday July 7, 10:25 am ET
By Julie Rannazzisi
NEW YORK (CBS.MW) -- U.S. stocks flexed their muscles Monday morning as technology stocks shot higher, sending the Nasdaq above the 1,700 mark for the first time since May 2002.
The market advanced in the face of profit warnings from the likes of BMC Software and Schering-Plough as investors bet that second-quarter results would come in ahead of expectations since the pace of negative pre-announcements has been slower than usual.
The Dow Jones Industrial Average (CBOT^DJINews) zoomed 170 points, or 1.9 percent, to 9,242. All of the Dow's 30 components headed higher, spearheaded by the shares of Intel, Microsoft, General Electric and J.P. Morgan Chase.
The Nasdaq Composite (NasdaqSC^IXICNews) rallied 42 points, or 2.6 percent, to 1,706 and the Nasdaq 100 Index (NasdaqSC^NDXNews) ran up 35 points, or 2.8 percent, to 1,266.
Strategists believe the second-quarter reporting season, which begins in earnest next week, will be crucial in determining whether the nearly four-month old rally in equities can continue or whether it has run its course.
Wall Street analysts expect second-quarter earnings to grow 5.4 percent year-over-year. Two Dow components will unearth their results this week: Alcoa and General Electric.
The Standard & Poor's 500 Index (CBOE^SPXNews) raced 1.8 percent higher while the Russell 2000 Index (CBOE^RUTNews) of small-capitalization stocks advanced 1.6 percent.
Volume came in at 274 million on the NYSE and at 410 million on the Nasdaq Stock Market. Winners obliterated losers by 22 to 7 on the NYSE and by 22 to 6 on the Nasdaq.
On the fund flow front, Trim Tabs estimated that all equity funds got inflows of $2.5 billion in the week ending July 2, compared with outflows of $1.5 billion in the prior week. And equity funds that invest primarily in U.S. stocks had inflows of $400 million vs. outflows of $200 million during the prior week.
Finally, Trim Tabs estimated that bond funds received an infusion of $1.8 billion for the third consecutive week.
Schering, Redback and BMC trip on warnings
Blaming competitive pressures on its major products, Schering (NYSESGPNews) warned that second-quarter and second-half earnings would fall short of current projections. Shares of the drugmaker slid 4.2 percent.
BMC Software (NYSEBMCNews) eased 6.5 percent after telling investors that its fiscal first-quarter results would fall short of expectations because of delays in purchasing decisions by large customers.
Redback Networks (NasdaqNMRBAKNews) took a 25.3 percent nosedive after telling investors late last Thursday that its second-quarter revenue would come in below expectations due to continued caution by its customers and weakness in Asian markets.
In analyst actions, J.P. Morgan lifted its second-quarter earnings and revenue estimate on Net bellwether Yahoo (NasdaqNMYHOONews) on expectations for solid advertising sales, sending shares 2.3 percent higher
Treasurys struggle
Government bonds slipped, adding to last week's brutal losses as investors continued to flee fixed-income issues amid growing expectations that an economic recovery will take hold in the second half of the year.
The 10-year Treasury note slipped 10/32 to yield (CBOE^TNXNews) 3.695 percent while the 30-year government bond eased 9/32 to yield (CBOE^TYXNews) 4.705 percent.
No economic reports are due out on Monday in a week that will see few releases of significance. Among them: weekly jobless claims, the June producer price index and the University of Michigan's preliminary reading on July consumer sentiment.
In the currency sector, the U.S. dollar rose against its major trading counterparts, climbing 0.1 percent to 118.25 yen while the euro slid 1.2 percent to a 2-month low at $1.1352.
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