Last week, tech issues played a major role in moving the broader market,
as investors downplayed disappointing economic data. "The market is being
pushed higher more on the news of individual corporate profits and comments
like IBM's rather than the economic backdrop, which is mixed at best,"
commented Brett Mitstifer, senior portfolio manager at Value Line Asset
Management, to Reuters News. International Business Machines' chief executive
commented that demand for technology had stabilized compared to last year. On
the downside of economic news, the U.S. trade gap widened, industrial
production and capacity use slipped, retail sales' figures were weaker than
expected and housing starts ebbed. Also, fanning fears of deflation, the
producer price index endured the steepest fall on record, while the consumer
price index dipped. However, helping to mitigate market losses, software
issues jumped as Intuit's profit more than doubled and Computer Associates
International posted a narrower net loss. Communications-equipment firms also
accelerated. Smith Barney upgraded the industry as a whole, along with Juniper
Networks. Cisco also surged after receiving an upgrade from Lehman Brothers,
which is confident about the firm's upcoming operations. "(Cisco) definitely
helps. Cisco is a big company and it's heavily weighted in a lot of indexes.
If it goes up, it pulls a lot of major indexes up with it," said David
Memmott, head of listed block trading at Morgan Stanley, in a Reuters news
piece. Chip issues, however, were under some pressure. Chip-equipment maker
Applied Materials plunged after it forecast lackluster order and revenue
figures for its third quarter. Semis also endured a setback after Merrill
Lynch downgraded several stocks within that industry. In hardware news, Dell
Computer saw a jump in its quarterly revenue and PC shipments; however, market
watchers were disappointed the firm didn't exceed expectations, sending that
stock lower. This week, with very little economic news to seize investor
focus, earnings from Dow component Hewlett-Packard will be on display.

    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.thomsonfinancial.com.

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