SAN FRANCISCO (09/01/2000) - Large-cap tech stocks and other "traditional" technology companies sent the Nasdaq up 2.5 percent, or 102.54 points, to 4206.35 Thursday. "The core tech names are driving" the market's increase, "telecommunications and semiconductor companies," said Greg Konezny, a senior research analyst at U.S. Bancorp (USB) Piper Jaffray. Dell shot up $3.69, or 9.23 percent, to $43.62; Cisco Systems Inc. was up $1.94, or 2.91 percent, to $68.50. Intel Corp. (INTC) , meanwhile, gained $1.37, or 1.87 percent, to close at $74.87.
The Dow rose 1.01 percent, or 112.09 points, to close at 11215.10, thanks to the impressive performance of financial stocks. J.P. Morgan led the rally; it was up $15.31, or 10.08 percent, to $167.19. TheStreet.com Inc. (TSCM) 's Internet index fared a little worse, falling 0.34 percent, or 2.89 points, to 840.46.
Though the Internet sector as a whole lost ground, there were good performances from Ask Jeeves (ASKJ) , up $2.50, or 8.93 percent, to $30.50, and Ticketmaster-CitySearch, up $1.06, or 4.62 percent, to $24.06. The two companies announced a strategic alliance, whereby TMCS will provide Ask Jeeves with information on local content and event tickets.
Safa Rashtchy, another senior analyst at U.S. Bancorp Piper Jaffray, noted that Ask Jeeves has also received tremendous support from customers such as Martha Stewart Living Omnimedia (MSO) , Dell, Microsoft (MSFT) and Ford Motor (F) . These companies use the Ask Jeeves natural-language question-and-answer technology to handle customer-service inquiries, thereby cutting down on relatively expensive telephone inquiries. Ford Motor, for instance, uses the Ask Jeeves search engine to field questions about the Firestone tire recall.
Analyst Initiations
Akamai Technologies was up $3.06, or 4.22 percent, to $75.56, after Wit Soundview initiated coverage on the company as a "buy." Redback increased $12.37, or 9.03 percent, to $149.37, after CIBC World Markets initiated coverage with a "buy." Scient (SCNT) fell $3.50, or 11.45 percent, to $27.06, after First Union Securities downgraded it from "strong buy" to "buy."
Mixed Bag
Exodus Communications (EXDS) was up 56 cents, or 0.83 percent, to $68.44 after announcing it had been chosen to host the Gore-Lieberman Web site.
Overall, Piper Jaffray's Rashtchy says that the slow August market has been the product of a self-fulfilling prophecy: We expect summer to be slow, so it's slow. Come September, this should change. "There is nothing that has changed in any of the fundamentals of these companies" said Rashtchy, "but September is supposed to be the beginning of a rebound."