After being bludgeoned last week amid the double threats of war and recession, U.S. markets began to show signs of life again Monday morning, as bargain hunters swooped in to buy oversold shares and some tech stocks rallied.
The Dow Jones Industrial Average, in late-morning trading, soared 322.59 points, or 3.91 percent to 8,558.40, while the Nasdaq surged 69.03 points, or 4.85 percent to 1,492.22, in the first market gains since the devastating Sept. 11 terrorism attacks on the U.S.
The rally came on the heels of one of Wall Street's most harrowing rides last week when the Dow lost 1,370 points, or 14 percent, of its value, in five days, posting its biggest loss since the Great Depression. The Nasdaq did not fare better, racking up a 16 percent loss over the same period.
However, after what some analysts have called an emotionally driven sell-off resulting from the terrorist attacks two weeks ago, investors were lured back to the market Monday by irresistible deals on blue chip stocks.
Major tech shares thrived, with hardware stocks experiencing some of the biggest gains.
Oracle Corp. (ORCL) jumped 9.01 percent to $11.73, Dell Computer Corp. (DELL) leapt 9.92 percent to $18.28, and Intel Corp. (INTC) traded up 6.94 percent to $20.64, while IBM Corp. made modest gains, rising 2.36 percent to $92.64.
Compaq Computer Corp. and Hewlett-Packard Co. (HP), continued their Friday climbs, inching up 4.76 percent to $8.37 and 4.34 percent to $15.61, respectively.
Meanwhile, RealNetworks Inc. (RNWK), fresh off of announcing Monday morning that it is marrying its RealPlayer and RealJukebox products into one, dubbed RealOne, surged 21.86 percent to $4.07 [See "Real Networks mixes Player, Jukebox software" Sept. 24].
Yahoo Inc. (YHOO) also posted gains, shooting up 4.27 percent to $9.05, while AOL Time Warner Inc. (AOL) rose 7.50 percent to $32.09.
Microsoft Corp. (MSFT) gained 1.63 percent to $50.52, as news that six more U.S. states are supporting the government's antitrust case against the monopoly, and that release of its long-awaited Xbox gaming console would be delayed, stymied a sharp rebound [See "MS/DOJ - Non-suing states raise XP concerns" Sept. 24 and "Xbox to come one week late" Sept. 21].
Biometrics firms continued to reap rewards Monday amid forecasts of increased security spending. Facial and retina scanning technologies maker Visionics Corp. (VSNX) rose 12.50 percent to $11.70, while digital identification systems maker Viisage Technology Inc. (VISG) jumped 32.72 percent to $7.10.
The markets also advanced on news that the beleaguered airline industry was getting a boost from Congress' approval over the weekend of a US$15 billion federal bailout package comprising $5 billion in direct aid and $10 billion in loan guarantees. The airlines pressed the government for help after the attacks resulted in a temporary halt of all air travel and then a steep decline in consumer demand, costing the industry billions.
The trading upswing was anticipated in European markets, which seemed to show some relief that the U.S. did not engage in any retaliatory measures over the weekend.
The London FTSE 100 index traded up 91.6 points, or 2.07 percent to 4,525.3, while the Frankfurt DAX 30 index surged 142.91 points, or 3.77 percent, to 3,930.14. The Paris CAC 40 index jumped 121.87 points, or 3.34 percent to 3,774.74, while the Amsterdam AEX 25 index rose 14.89 points, or 3.76 percent to 311.12.