What goes down must come up
Stocks rallied yesterday led by number-two computer maker Dell Computer Corp. and Internet media giant, Yahoo Inc."I don't think we can make a case that we have or have not had that final blowoff," said Charles Lemonides at M&R Capital Management. "But whether or not we have, if you commit capital at today's levels, six months from now you will stand very well rewarded."
The Nasdaq Composite Index rebounded with a gain of 145.53 points, or 8.88 percent, to 1,784.33, after losing more than two percent on Wednesday.
The blue-chip Dow Jones industrial average gained 410.57 points, or 4.31 percent, to close at 9,925.99.
The broader Standard & Poor's 500 Index ended up 47.45 points, or 4.3 percent, at 1,150.70.
Both the Nasdaq and the S&P are still in bear territory, however.
Michael Dell, Chairman of Dell Computer Corp., said yesterday that his company ended the first quarter of 2001on the right track. Dell said that the company is working on regaining market share from company rivals.
Dell shares gained $3-3/16, or more than 14 percent, at $25-3/8 in afternoon trading on the Nasdaq.
Shares of Yahoo! Inc. rallied Thursday as Lehman Brothers analyst Holly Becker, who had been among the first to downgrade the company, raised her ratings for the Internet media giant.
Yahoo shares rose about 21 percent - or $2-11/16, to $15-1/8 - above its 52-week low of $11-3/8, but they are still down over 90 percent from one year ago.
"It's entirely Becker's note," said Arnold Berman, technology strategist at Wit/Soundview. "The great thing about Yahoo is that they have a lot of page views. They are still one of the dominant forms of how people go about 'watching the Internet,' and at some point Holly is right in suggesting that the franchise could be of some value to a media buyer. But there is nothing about the current economics or overhead that looks reasonable."
Technology stocks fell Wednesday amid ongoing concerns of a continuing economic slowdown. Out of the 25 most heavily traded stocks in the Nasdaq, 18 reached new 52-week lows.
The tech-rich index lost 34.20 points, or 2.04 percent, to close at 1,638.80 after suffering its third straight losing session and hitting its lowest close since mid-October of 1998.
"People don't know what to do," said Edgar Peters, chief investment officer at PanAgora Asset Management Inc., which manages $16 billion. "People think they should be buying, but most of them are afraid to."
The blue-chip Dow Jones Industrial Average briefly reached bear territory as the market measure slipped below the 9,378.38 level. The index ended the session up 29.71 points, or 0.31 percent, to 9,515.42.
The broad S&P 500 index fell 3.21 points, or 0.29 percent, to 1,103.251, which marks its lowest close since the autumn of 1998.
A dragging economy
Federal Reserve Governor Laurence Meyer said yesterday that economic growth has slowed far more than he had previously anticipated."I did not see the degree of slowdown which turned out to be much sharper than I expected," Meyer told an audience of legislative, business, and community leaders from financial institutions.
The US economy grew at a mere one percent in the fourth quarter of 2000 compared to rates of 4.8 and 5.6 percent in the first and second quarters, respectively.
Consumers are unexpectedly regaining confidence in the US economy, according to recent data. Meyer said, however, that consumer confidence data is not always useful.
"Consumer confidence numbers don't provide that much independent information and this has to be factored into one's judgement in one's forecasts," he said. "Sometimes [the data] clearly mirrors the underlying economy, but sometimes there is a difference between the underlying data and how people feel."
