The Nasdaq Composite Index rose on Thursday, lifted by gains in Intel Corp on expectations the company may cut its chip prices to expand market share.
Volume was light during the session, which wrapped up a holiday-shortened week. Oil's rebound above $69 a barrel and a drop in General Electric Co's stock limited the gains in the Dow industrials and the Standard & Poor's 500 Index.
Shares of Intel, the world's largest chip maker, rose 1.7 percent on the belief that that it will cut its chip prices aggressively in the coming quarters, undercutting rivals like Advanced Micro Devices Inc, as it attempts to take back market share it lost in recent years, analysts said.
"Many of the large-cap tech stocks, including Intel, are undervalued," said Giri Cherukuri, head equity trader at OakBrook Investments LLC, in Lisle, Illinois, with $1.3 billion in assets. "Any move strengthening their position in the market, makes their stocks more attractive."
The Nasdaq Composite Index gained 11.43 points, or 0.49 percent, to close at 2,326.11. The Dow Jones industrial average advanced 7.68 points, or 0.07 percent, to finish at 11,137.65. The Standard & Poor's 500 Index rose 1.00 point, or 0.08 percent, to end at 1,289.12.
For the week, the blue chip Dow average gained 0.16 percent, while the S&P 500 declined 0.49 percent and the Nasdaq Composite Index fell 0.55 percent.
Intel shares, up 33 cents at $19.45 on Nasdaq, also got a boost from news that the chip maker's Chinese subsidiary has agreed to develop search and other applications in China with Chinese-language Internet search service Baidu.com Inc.
Shares of GE, a Dow component, slipped 1.7 percent, or 57 cents, to $33.89 on the New York Stock Exchange. GE, a diversified manufacturer, disappointed some investors when it did not raise its 2006 outlook. The company, which also owns a television network and provides financial services, reported a 9 percent rise in first-quarter profit.
US crude oil for May delivery rose 70 cents to settle at $69.32 a barrel, lifted by short-covering and fresh buying ahead of the long holiday weekend.
The yield on the benchmark 10-year US Treasury note climbed above 5 percent for the first time in nearly four years, reflecting bond investors' concerns about economic growth, rising rates and inflation.
"Fears of higher oil prices and higher rates remain among investors and that's been putting a cap on stocks' gains," OakBrook's Cherukuri said.
The Federal Reserve is focused on curbing inflation, though the pace of economic growth is likely to ease in coming months, Fed Governor Donald Kohn said in remarks prepared for a business meeting in Oklahoma City.
The Dow's biggest lift came from International Business Machines Corp, the world's largest computer services company. IBM's stock scored its biggest one-day percentage advance in more than three months after Lehman Brothers raised its price target to $92 from $90.
IBM gained 1.5 percent, or $1.23, to close at $81.98 on the NYSE, after hitting a session high at $82.60.
On Nasdaq, shares of Sandisk Corp jumped 4.1 percent, or $2.43, to $61.90, a day after Standard & Poor's said the memory card maker's stock would be added to the benchmark S&P 500 index. Cisco Systems Inc shares rose 0.8 percent, or 16 cents, to $21.18 after UBS raised its price target to $23 from $21,50, citing continued strength in the US market for its high-end network equipment. But shares of Advanced Micro Devices fell 10.2 percent, or $3.62, to $31.80 on the NYSE, a day after the computer processor maker forecast sales below analysts' estimates.
Trading volume was lighter than usual as US financial markets will be closed for Good Friday. Trading will resume on Monday.
About 1.24 billion shares changed hands on the New York Stock Exchange, below last year's daily average of 1.61 billion. On Nasdaq, about 1.56 billion shares traded, below last year's daily average of 1.80 billion.
On the NYSE, decliners outnumbered advancers by a ratio of about 6 to 5. But on Nasdaq, about three stocks rose for every two that fell.
Comments
Comments are closed.