Stocks post biggest gain in 2 weeks


NEW YORK -- U.S. stocks posted their biggest gain in almost two weeks yesterday, fueled by higher prices for technology, oil and bank companies and a string of better-than-expected earnings.

Investors returned to technology stocks only a few days after being scared off by disappointing news from Intel Corp., Microsoft Corp. and Apple Computer Inc.

Meanwhile, Chevron Corp., Atlantic Richfield Co., Dean Witter Discover & Co., Union Carbide Corp., Kimberly-Clark Corp., Stone Container Corp. and Black & Decker Corp. were among companies reporting unexpectedly strong earnings.

Helped by higher prices for Intel, Microsoft Corp. and Oracle Systems Corp., the technology-laden Nasdaq composite index surged 16.80, to 978.57, its fifth-largest point-gain ever and the biggest advance since it rose 18.41 points on July 12. The Nasdaq index is 2.7 percent below its July 17 record of 1,005.89.

The Dow Jones industrial average jumped 27.12, to 4,668.67, boosted by International Business Machines Corp., Caterpillar Inc. and J. P. Morgan & Co.

Almost seven stocks rose for every four that fell on the New York Stock Exchange. For an 11th straight day, more shares traded on the Nasdaq stock market than on the New York Stock Exchange, 404 million to 315.3 million.

The Nasdaq index's gain marked the revival of technology stocks. Expectations that earnings at technology companies would grow faster than they would in most other industries made semiconductor, personal computer and software companies the vanguard of the stock market's eight-month advance. Last week, that advance abruptly slowed as investors doubted earnings over the next year or two would meet expectations.

Technology companies "took us up before, maybe they'll take us up again," said Edward Collins, executive vice president for equities at Daiwa Securities America.

Among computer makers, IBM jumped $3.875, to $107.50, single-handedly adding 9.9 points to the Dow industrials. Silicon Graphics Inc. gained $3.25, to $43.875, Sun Microsystems Inc. advanced $4, to $45.75, and Apple rose $1.625, to $45.375.

The broader market also posted gains, as the Standard & Poor's 500 index added 3.01, to 556.63, as telephone, communications equipment and money-center bank stocks also advanced.

The Russell 2000 index of small-company stocks gained 2.86, to 293.39, and the Wilshire 5000 index gained 34.62, to 5,483.40.

Oil stocks improved as Chevron's second-quarter earnings of 93 cents a share, up from 39 cents last year, beat expectations of 85 cents. Mobil Corp.'s second-quarter earnings from operations surged 38 percent as oil prices rose, refining margins widened and chemical sales climbed.

Arco's net income leaped to $2.39 a share from 14 cents last year and analysts' forecast of $2.19.

Chevron added $1, to $48, Mobil rose 62.5 cents, to $101, Royal Dutch Petroleum Co. vaulted $2.625, to $126.125, and Texaco Inc. gained 50 cents, $65.625.

Optimism about takeover opportunities got a lift from renewed merger and acquisition activity: Bank of Boston Corp. was the subject of takeover interest by a number of other banks and Gannett Co. agreed to buy Multimedia Inc. for $1.7 billion.

Bank of Boston shares jumped $1.625, to $41.75, even as Banc One Corp. withdrew a $5 billion takeover offer.

First Interstate Bancorp climbed $2.50, to $86.50, Suntrust Banks Inc. gained $1.75, to $60.125, Corestates Financial Corp., which withdrew a takeover offer for Bank of Boston, rose $1, to $34.875, and Old Kent Financial Corp. added $1.0625, to $37.125.

Multimedia rose 50 cents, to $42.25, and Gannett fell 50 cents, to $53.25.

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