By Kate Gibson
Wall Street's six-week run-up briefly stalled at the start this
week, as investors revisited recent events in the financial sector
and as analysts considered strength in the technology sector and
how far it could carry the broader market.
Despite finishing higher for the past six weeks straight, the
Dow Jones Industrial Average (DJI) hasn't risen on a Monday since
March 23. That pattern persisted as the current week began, with
the blue-chip index falling nearly 300 points.
On Tuesday, stocks tilted solidly higher in afternoon trade
after meandering between gains and losses early on. The Dow gained
61.25 points to 7,902.98. The S&P 500 (SPX) advanced 9.71
points to 842.10, while the technology-laden Nasdaq Composite
(RIXF) climbed 21.79 points to stand at 1,630.00.
"U.S. equities turned the corner and rebounded led by the
technology sector following a solid earnings result from Texas
Instruments Inc. (TXI) and this was compounded on the blue chips by
a better than expected profit reading from diversified manufacturer
United Technologies Corp. (UTX). A merger bid in tech also fueled
some investor appetite after Broadcom Corp. (BRCM) made an
unsolicited bid for Emulex Corp. (ELX)," said analysts at Action
Economics. .
While many are looking to the tech sector to "lead us out of the
current malaise," and the stocks themselves may outperform going
forward, the fact remains that worldwide technology spending is
down," said Dan Greenhaus, equity strategy group, Miller Tabak
& Co.
Bank stocks had led Monday's market declines as a slew of
earnings reports intensified concern that the credit and economic
climate is less rosy than might have been suggested in the sector's
April rally.
"The market seems to be sobering on banks," Nick Kalivas, an
equity analyst at MF Global.
Bank of America's results, reported Monday, illustrated
"everything right and wrong with the financial sector this
quarter," said Marc Pado, U.S. market strategist at Cantor
Fitzgerald.
"These are not revenues that will be repeated, a common
complaint about much of the bank earnings this past quarter," Pado
said. .