International market report: Investors plough into technology shares on feelgood jobs factor

US EQUITIES yesterday as investors emboldened by encouraginglabour market data and optimistic earnings views snatched up beaten-down technology and other shares.

A flurry of positive brokerage calls also whetted investors'appetites, especially for tech shares. The buying was active in thesemiconductor sector, which had taken a drubbing in the past twoweeks following a healthy run from mid-March.

Biotechnology firm Esperion Therapeutics soared 19 per cent on aninvestment bank upgrade. Wireless firm Nextel Communications, whichgave an upbeat financial forecast, rose more than 7 per cent.

The tech-laced Nasdaq Composite Index rose 31.35 points, or 1.96per cent, at 1,634.01. The blue-chip Dow Jones industrial averageadded 67.51 points, or 0.75 per cent, to 9,079.04, while the broaderStandard & Poor's 500 index rose 10.49 points, to 985.81.

Investors welcomed a report suggesting signs of improvement aheadwhen it showed that first-time unemployment claims fell last week.But a second report showed that the economy grew more slowly thanpreviously thought in the first quarter.

Investors put behind them their disappointment at the FederalReserve's quarter-point cut in interest rates, focusing instead onthe bright spots among the day's corporate and economic news andscooping up shares after a modest pullback in stock prices this week.

"The market is in a position now where it is going to be somewhatquiet for the next couple of weeks or possibly even two or threemonths as investors await second-half earnings," said Keith Keenan,of institutional trading at brokerage Wall Street Access.

The Philadelphia semiconductor index rose 2.75 per cent, havingfallen 14 per cent from its early June peak. "The semi stocks arestrong and the rest of the technology sector is following," said RayRund, director of research at Shaker Investments. "It has fallenquite a ways there. Maybe this buying today is some short-termpositioning."

Top chipmaker Intel rose 59 cents, or nearly to $20.63. Nextelsaid it was on track to meet or exceed its 2003 forecasts, pushingits stock price up to its highest level in two years. Shares rose$1.21 to $18.16 and helped rivals such as AT&T Wireless Services, up47 cents to $8.27.

Internet stocks such as Yahoo also rose handsomely, sending theAmerican Stock Exchange Internet index up 2.6 per cent. Yahoo added$1.55 to $32.90, or nearly 5 per cent.

American Airlines parent AMR surged $1.80, to $10.88 after theworld's largest airline reported positive May cash flow and aninvestment firm upgraded the stock.

Dow stock Altria gained 81 cents at $44.78, after the CaliforniaSupreme Court ordered a lower court to reconsider a $26.5 millionjudgment against Altria's Philip Morris USA tobacco company.

EUROPEAN blue-chip shares closed just lower as hefty losses fromheavily weighted insurance and pharmaceutical stocks offset strongclimbers in the auto and retail sectors. Italy's largest insurerGenerali dragged its European sector down on news that Merrill Lynchhad sold 31.3 million of its shares at a discount to the marketprice. Elan was another standout decliner.

The pan-European FTSE Eurotop 300 was 0.1 per cent lower at 859points, while the narrower DJ Euro Stoxx 50 also fell 0.16 per centto 2,450.

Strategists said further market correction was in the offing aswhat they expect to be a disappointing quarterly earnings seasonunfolds and as companies fail to give clear guidance for forthcomingquarters amid a persistently fragile environment.

The French CAC-40 ended off 0.2 per cent at 3,104 in Paris and theSwiss Market Index nudged 0.3 per cent higher at 4,848. Buoyantshares in German carmakers DaimlerChrysler and BMW hoistedFrankfurt's DAX 0.9 per cent higher at 3,227.

MOST Asian markets closed lower with share prices in Tokyo andHong Kong sliding to mirror overnight losses on Wall Street. InTokyo, the Nikkei Stock Average of 225 selected issues fell 8.85points to 8,923.41.

Japanese shares succumbed to selling as investors were unimpressedby the US Federal Reserve's quarter-point cut in interest rates. Thenews weighed on shares of Japanese exporters, which rely heavily onsales in the US. Electronics companies Fujitsu, NEC and Nintendo allfell.

In Hong Kong, shares fell marginally after late buying in propertystocks helped curb earlier losses following weakness in US markets.The Hang Seng Index dropped 22.88 points to 9,606.11.