Nasdaq extended its rally last week, reaching a new 2 1/2 year high, as
many investors are positive on the brink of earnings season. Peter Dunay,
chief market and options strategist at Wall Street Access, told Reuters News,
"People are extremely optimistic about earnings and the economy, so we're in
an area where there's little to be concerned about in the near term." Dunay
further explained, "With such strong growth forecasts for the fourth quarter,
coupled with the fact there have been very few earnings warnings, we're being
set up for a very strong period right now." But it wasn't pure investor
cheerfulness that roused the Nasdaq, as tech stocks worked very hard to push
the index higher. Communications equipment issues were a strong sector force.
Nokia and Andrew Corp. rallied, after they raised their quarterly financial
outlooks. Anticipated contracts from Verizon Communications' planned $3
billion investment into its networks sent stocks such as Lucent and Nortel
skyrocketing. Those firms also benefited from separate publicized contracts.
Chip stocks were also major winners last week. Taiwan Semiconductor reported
that its December sales rose 67% from a year ago, helping it reach a new
quarterly revenue record. Separately, the World Semiconductor Trade Statistics
group said that sales of chips rallied 25.7% in November. Also, software maker
Siebel Systems surged, after it raised its fourth-quarter financial forecast,
partly due to higher license revenue. This week promises to be just as news
worthy. Joe Kalinowski, research director at Puglisi & Co., said to Reuters
News, "A lot of people are positioning themselves for the upcoming year, and
technology appears to be in favor, judging by the Nasdaq's performance."
Considering the heavyweights on the docket to report this week, including
Intel and Sun Microsystems, investors' positions will hopefully improve.
High-Tech Monday Update is provided courtesy of Thomson Financial. This
information is believed to be true and accurate; we take no responsibility for
inaccurate information and reserve the right to update our reports. For more
information, please visit our web site at http://www.thomson.com/financial.
SOURCE Thomson Financial
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