u.s. tech stocks lifted by nokia; oil weighs on do
U.S. tech stocks lifted by Nokia; oil weighs on Dow September 9, 2004 4:51pm ET (Reuters)
(Updates to close)
By Megan Davies
NEW YORK, Sept 9 (Reuters) - U.S. technology stocks gained on Thursday after bellwether Nokia raised its earnings forecast, but blue chips slipped as oil prices climbed almost $2 per barrel, increasing concerns about future corporate profits.
Finland's Nokia , the world's No. 1 mobile phone maker, raised its third-quarter sales and earnings outlooks due to strong demand, giving a boost to S&P component Texas Instruments Inc. , the world's largest maker of chips for cell phones.
Texas Instruments, which counts Nokia as its largest customer, on Wednesday trimmed its third-quarter revenue outlook but said it would meet its profit forecast.
"Texas Instruments has probably had the biggest effect -- with the outlook there not as bad as people expected it to be," said Owen Fitzpatrick, head of U.S. equity group at Deutsche Bank Private Wealth Management.
"That's helping a tech rally with people rotating into the sector," he added.
Meanwhile, analog chipmaker National Semiconductor Corp. helped spur tech gains when it posted a higher quarterly profit on Thursday.
The Dow Jones industrial average closed down 24.26 points, or 0.24 percent, at 10,289.10. The Standard & Poor's 500 Index rose 2.11 points, or 0.19 percent, to 1,118.38. The technology-laced Nasdaq Composite Index ended up 19.01 points, or 1.03 percent, at 1,869.65.
Trading was active, with 1.37 billion shares changing hands on the New York Stock Exchange, just below the 1.4 billion daily average for last year. About 1.66 billion shares were traded on Nasdaq, just below the 1.69 billion daily average last year.
Advancers outnumbered decliners on the NYSE by about 5-to-3, and Nasdaq by about 2-to-1.
A hike in oil prices had a "limited" impact on stocks, said Paul Cherney, chief market analyst at Standard & Poor's, hurting "some of the more conservative defensive, industrially-orientated stocks that had done well as oil had fallen."
Higher oil prices, which have roiled markets all summer, usually spell bad news for stock prices, as investors worry about the impact of higher costs on companies' profit margins. October crude on the New York Mercantile Exchange settled $1.84, or 4.3 percent, higher at $44.61 per barrel after a government report showing U.S. crude stocks fell more than expected last week.
Industrial stocks under pressure included Boeing Co. , down 79 cents at $53.26 and General Motors Corp. , 39 cents lower at $42.82. Both are Dow components. Pharmaceuticals were also under the gun, with Pfizer Inc. 33 cents lower at $32.44.
"We're seeing a rotation into the more economically sensitive sectors," said Owen Fitzpatrick, head of U.S. equity group at Deutsche Bank Private Wealth Management.
"We had Greenspan's comments yesterday and I think investors are hoping for a re-acceleration not only in economic growth but hopefully also in expectations in earnings."
Federal Reserve Chairman Alan Greenspan said in congressional testimony on Wednesday the economy had climbed out of its recent soft patch and was picking up steam.
Meanwhile, data on Thursday showed U.S. weekly jobless claims fell by the steepest decline in nearly three years, according to the Labor Department, and adding some support to Greenspan's remarks.
Procter & Gamble Co. weighed on the Dow after the consumer products manufacturer backed its quarterly profit outlook but disappointed investors who were accustomed to P&G raising its forecast midway through the quarter. Procter & Gamble fell 64 cents to $56.09.
But Corning Inc. rose 94 cents, or 9.3 percent, to $11.09. Corning raised its forecast on Wednesday for fiber optic cable sales.
Texas Instruments gained more than 10 percent, up $1.94 at $20.77. Nokia's shares traded in the U.S. rose $1.06 to $13.77. National Semiconductor rose more than 12 percent, up $1.48 to $13.48.
