Wall Street bounded higher Wednesday, lifting the Nasdaq composite index well over 1% after profit reports from Yahoo Inc. and Sun Microsystems Inc. restored investors’ confidence in the tech sector.
NEW YORK (AP) — Wall Street bounded higher Wednesday, lifting the Nasdaq composite index well over 1 percent after profit reports from Yahoo Inc. and Sun Microsystems Inc. restored investors’ confidence in the tech sector. The Dow Jones industrials logged fresh trading and closing highs.
Tech stocks have borne most of Wall Street’s concern about the health of corporate earnings in recent weeks. Restive investors, taking their cues from a flurry of profit reports, have been at turns pleased and concerned about the prospects that profit growth will help drive stocks higher following a sharp run-up in 2006.
There was little overall movement in the energy and health sectors in response to President Bush’s State of the Union address, during which he called for expanded health insurance coverage and a 20 percent reduction the country’s consumption of gasoline over the next 10 years. Some alternative-energy companies pulled back after rising sharply before the speech.
In an essentially all-earnings day, investors were left without new economic data to help provide some clues about the direction of interest rates.
“Some earnings are coming in a little better, some a little worse but it’s showing us that the fourth quarter wasn’t in recession and that’s comforting going forward,” said Kim Caughey, equity research analyst at Fort Pitt Capital Group. “The Fed isn’t going to have to ratchet up (interest rates) to cool down inflation.”
According to preliminary calculations, the tech-laden Nasdaq composite index jumped 34.87, or 1.43 percent, to 2,466.28. The gain marked the Nasdaq’s biggest one-day increase since early December.
The Dow rose 87.97, or 0.70 percent, to 12,621.77 after rising 56.64 on Tuesday. The Dow surpassed a record close of 12,582.59 set Jan. 16; it was the Dow’s 26th record close since the blue chip average began its run-up at the start of October. The Dow also reached a record intraday high of 12,623.45, topping a trading high of 12,614.00 reached a week earlier.
The Standard & Poor’s 500 index reached a six-year high, rising 12.14, or 0.85 percent, to 1,440.13.