The Nasdaq composite index rose to a new record today even as investors punished Microsoft for a profit report that met published estimates but failed to impress some Wall Street analysts.
The Nasdaq rose 20.48, to 4151.29, its first record high since it closed at 4131.15 on Jan. 3. The Dow Jones industrial average fell 71.36, to 11,489.36, a decline caused almost entirely by Microsoft.
Broader stock indicators were mixed. The Standard & Poor's 500-stock index rose 0.76, to 1455.90.
Microsoft fell 8-5/16, to 107. The company said late Tuesday that it earned $2.44 billion, or 44 cents per share, in its fiscal second quarter, surpassing the 42 cents predicted by analysts surveyed by First Call/Thomson Financial.
But traders said Microsoft's "whisper number"--an unofficial prediction circulated on the Internet and on trading floors--was as high as 49 cents, which left some investors disappointed when the earnings were announced.
Shares of Microsoft were also pressured by company officials' warning of a potential slowdown in demand for personal computers.
While they shunned Microsoft, investors returned to some big-name technology stocks that flourished in 1999. Qualcomm rose 7-9/16, to 146-5/8, and Yahoo soared 22-13/16, to 364.
"In a weaker market, Microsoft would have hurt the rest of the techs," said Gary Kaltbaum, chief technical analyst at J.W. Genesis Securities in Boca Raton, Fla. "That was not the case today."
The fever for technology stocks that began last year helped boost business for online brokerages E-Trade Group and DLJdirect, which both reported narrower-than-expected losses today. E-Trade fell 1 3/4, to 26-3/16, and DLJdirect gained 1 5/8, to 14-15/16.
Meanwhile, more traditional financial companies found their sterling profit reports tarnished by continued worries about interest rates.
Chase Manhattan rose 3 1/8, to 74 1/8, and Bear Stearns rose 1, to 43, after reporting earnings that easily beat expectations. But analysts said their gains were contained by concern that rising interest rates will cut into profits.