Wall Street built on Friday’s gains to push stock prices broadly higher Monday. The Nasdaq composite index reached a record high close for the second time in less than two weeks.
The Dow Jones industrial average rose 54.33 points, to 9070.47, on thin New York Stock Exchange volume of 655 million shares.
Computer-technology stocks, which dominate the Nasdaq index, also led the Dow higher. International Business Machines gained $9.94, to $167.19; Hewlett-Packard added $1, to $64.62.
The broader Standard & Poor’s 500 index advanced 10.96, to 1187.70, as winning stocks outnumbered losers by about 17-13 among NYSE-listed issues.
FDX, holding company for Federal Express, gained $4.75, to $72, after soaring to a record high $79.50 during the day. The company told Barron’s that Internet commerce was fueling shipping revenue. The Dow Jones transportation average, which includes FDX, gained 63.58, or 2.1 percent, to 3115.83.
The Nasdaq composite index rose 37.48, or 1.9 percent, to 2040.64, led by such big-name technology stocks as Microsoft, Dell Computer, Cisco Systems and Intel. A decision by South Carolina to withdraw from antitrust litigation against Microsoft, citing ample competition in Internet technology, boosted the entire sector.
Compaq Computer added $3, to a record closing high $41.69, after CS First Boston increased its earnings outlook for the company, citing strong holiday sales.
Locally, telecommunications equipment supplier Tellabs, based in Lisle, rose $5.44, to $65.56. Analysts told Reuters the company may be near to signing a supply contract with Sprint.
Beyond computer-tech issues, Oxford Health Plans added $3.19, to $14.87, after analysts at Donaldson Lufkin & Jenrette and Lehman Brothers issued “buy” ratings on the health maintenance organization sponsor.
The Russell 2000 index of small-company stocks gained 2.80 to 401.17.
Trading got off to a strong start Monday after Hong Kong stocks rallied on news of surprise interest rate cuts in China and Hong Kong. Last year, Hong Kong raised rates to defend its currency from speculators, a move that appears to have worked.
The Hang Seng index at the Hong Kong Stock Exchange rose 4.7 percent on Monday.
The principal stock market index in Brazil jumped 4.2 percent on renewed hopes that the country will enact fiscal austerity measures needed to build international investor confidence. Analysts said Monday’s move was partly a reaction to last week’s sharp sell-off sparked by the failure of an austerity measure in Brazil’s Congress.
At home, investors took heart from a report that consumer credit in the United States jumped by a much greater-than-expected $9.7 billion in October, up from a $5.1 billion gain in September–a sign that consumers grew confident about spending ahead of the holiday shopping season.
Oil-drilling stocks rallied on hopes that the recent decline in oil prices had reached a bottom. Schlumberger added $2.81 to $44.06.
Treasury auction:The Treasury’s weekly auction brought a discount rate of 4.32 percent on three-month bills, down from 4.43 percent last week, and 4.37 percent on six-month bills, down from 4.41 percent last week.
Treasury securities ended mixed in light trading Monday.
Local news: Electrical fusemaker Littelfuse, Des Plaines, sank $5.12, to $19.87, after the company warned that fourth-quarter profits would be 35 percent to 40 percent less than third-quarter profits. The company blamed weakness in North American and Japanese markets. Alexander Paris Sr. of Chicago-based Barrington Research Associates told Reuters that Littelfuse has been hurt by the tendency of its distributors to hold inventories at low levels. “Some people thought they might have finally gone as far as they could, but obviously they’re still doing it,” he said.
– Aircraft service and parts supplier AAR, Wood Dale, gained $1.50, to $23.50, after the company reiterated that sales to Boeing account for less than 1 percent of AAR’s business. AAR stock sank 12 percent last week in sympathy with a slide in Boeing shares. Boeing announced widespread layoffs and forecast more troubles ahead in Asia.
– Factory Card Outlet, a chain of stores selling cards and party supplies, fell 25 cents, to $1.94. The company disclosed late Monday that its chief financial officer, Thomas Stoltz, resigned. Two weeks ago, the company said fourth-quarter results would fall short of analysts’ estimates after a poor Halloween selling period.
– Chicago-based cellular telephone service U.S. Cellular rose 44 cents, to $39.44. Chicago-based Everen Securities boosted its earnings estimates for the company in 1999 and 2000.
– CS First Boston began research coverage of Chicago-based Heller Financial with a “buy” rating. The stock gained 94 cents, to $28.69.
– Metzler Group, a Chicago-based information technology consulting firm, added 6 cents, to $41.75, after receiving a “buy” rating from Merrill Lynch. Merrill Lynch is one of the underwriters of a planned secondary offer of 4.25 million shares by the company and certain existing shareholders.
– First Industrial Realty, a Chicago-based real estate investment trust, gained $1.31, to $25.75, after the company boosted its quarterly dividend to 60 cents a share from 53 cents, payable Jan. 18 to shareholders of record Dec. 31.
