Midday Report: Tech Stocks Retain Momentum

Buoyed by strong earnings reports and corporate guidance from Ciena (Nasdaq: CIEN) and Hewlett-Packard (NYSE: HWP), investors sent the Nasdaq Composite Index slightly higher in early afternoon trading, after giving back the lion’s share of powerful gains posted at the opening bell.

The Nasdaq Composite Index had climbed 30.87 to 2,197.31 at midday, and the Standard & Poor’s 500 stock index was up 6.43 at 1,291.42. The Dow Jones Industrial Average also powered ahead 76.45 to 11,292.37.

Meanwhile, the E-Commerce Times Stock Index had risen 2.6 percent at midday. Among those in positive territory were Amazon (Nasdaq: AMZN), which gained 71 cents to $14.85; eBay (Nasdaq: EBAY), rising $2.48 to $60.34; and Travelocity (Nasdaq: TVLY), climbing $1.05 to $34.10.

Tech Leaders

Leading the technology charge was Ciena, climbing $3.46, or 6.2 percent, to $58.90. The communications equipment maker dodged the economic bullet that has hit many of its rivals, reporting Thursday that its second-quarter profit climbed more than 19 percent to top analyst forecasts.

The company earned 20 cents per share, beating analyst estimates by 4 cents, and repeated its bullish outlook for its business originally made in March.

Dell Computer (Nasdaq: DELL) inched up 89 cents to $25.38. The personal computer maker is scheduled to unleash its results after the close Thursday. According to a consensus of analysts surveyed by First Call, the company is expected to report earnings of 17 cents per share, down from 19 cents a year earlier.

HP Looks Ahead

Dow leader Hewlett-Packard (NYSE: HWP) gained $1.34, or 5.3 percent, to $26.74. The computer and printer manufacturer reported late Wednesday that its lower second-quarter profit topped reduced estimates on Wall Street.

HP also said it was confident it will meet earnings forecasts for its third quarter, although it warned that sales could be lower due to weakness in the U.S. economy.

“HP needs a solid improvement in gross margin in order to achieve Wall Street third-quarter earnings estimates,” Credit Suisse First Boston said in a research note. “In a difficult pricing environment, this may prove difficult.”

The firm, however, continues to rate the stock as a hold and believes it will ride along the bottom in the coming months.

Job Watch Yields Hope

Adding to the optimism that the nation’s economy could be poised for a rebound were new reports from the Conference Board, which found that fewer Americans filed for unemployment claims last week.

The New York-based business research group said that its Index of Leading Indicators, a key gauge of U.S. economic performance, rose 0.1 percent in April after falling a revised 0.2 percent in March.

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