SAN FRANCISCO (04/25/2000) - The Nasdaq would make a top of the line yo-yo.
The tech-laden index was up 6.5 percent today, after three days of losses, including a drop of 4 percent yesterday. The index closed up 228.78, to 3711.26. The Dow confidently followed suit, closing up 2 percent, or 218.72, to 11124.82.
The Nasdaq is still far off its March peak, but for those who bought on the recent dips, the getting was good today. Tech stocks across sectors were up.
Large-cap IBM Corp. gained more than 5 percent to $112.50, and Intel Corp.
(INTC) gained 6.5 percent to $123.75. Sun Microsystems Inc. (SUNW) was up 6 percent to $93.18. Lucent Technologies Inc. (LU) gained 4 percent to $63.50.
Oracle Corp. (ORCL) and Cisco Systems Inc. were both up 3 percent, Oracle to $74.87 and Cisco to $65.43. Embattled Microsoft Corp. (MSFT) , which was widely blamed for triggering yesterday's Nasdaq losses, also gained more than 3 percent today, rising $2.31, to $68.93.
The Internet sector swung upward even more strongly. JDS Uniphase (JDSU) roared up 15 percent in anticipation of an earnings announcement this evening. The stock closed at $93. DoubleClick Inc. (DCLK) gained 15 percent, as well, to close at $66. CMGI (CMGI) was up 14 percent to $59.18, and sector-mate Internet Capital Group (ICGE) gained 6 percent to $40.25. Qualcomm Inc. enjoyed a slight rebound from yesterday's losses, gaining 4 percent to $104. Yahoo Inc. rose nearly 9 percent to $123.81, and eBay Inc. (EBAY) was up 6.5 percent to $151.18.
Business-to-business companies also had a good day: Commerce One Inc. (CMRC) rose more than 16 percent to $55.90, and Ariba Inc. (ARBA) was up 7 percent to $66.75.
At least one Internet observer predicts that the recent volatility will continue, possibly becoming even more pronounced in the coming months as the Internet sector sees more consolidation.
"This is going to be a process of separating the wheat from the chaff," says Aram Fuchs, CEO of FertileMind.net, an independent Internet equity research site. "Companies with good, solid management teams will come out on top, and the bad businesses will fail. The market doesn't know how to determine either of these yet, so it's just hitting people with gale-force swings."
For short-term investors, the winds have been fortuitous. Investors who bought tech stocks on April 14 (the day Nasdaq dropped by 10 percent) would have enjoyed a rally of 15 percent over the following two days. Today's rise would have brought similar gains to anyone who entered the market late last week.
The Dow was led upward today by big gains in AT&T Corp. (T) , which rose nearly 7 percent to $52.37. MCI WorldCom Inc. (WCOM) was up 5 percent to $41.81.
General Electric Co. (GE) rose 2 percent to $165.43. And Philip Morris (MO) was up nearly 3 percent, closing at $22.12.