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Blue chip eke out gain; Nasdaq sets new high

NEW YORK: Blue-chips stocks closed slightly higher Thursday after shaking off the weakness in oil company shares, while the Nasdaq market stormed to a record high on frenzied buying in high-technology and bio-technology shares.

The Dow Jones industrial average ended 1.81 points higher at 5,551.74, creeping back after Wednesday's 70-point fall.

The Nasdaq composite index rose 15.43 points, about 1.4 percent, to 1,136.30, topping the previous record of 1,124.92 set Tuesday.

In the broader market, advancing issues led declines 1,280 to 965 on active volume of 410 million shares on the New York Stock Exchange.

"The high-techs and biotechs are screaming. Absolutely screaming," said Phil Orlando, chief investment officer at Value Line Asset Management.

Analysts said the market was again earnings-driven.

"The techs were up pretty strongly. We're waiting and watching for Microsoft. That may be the real excitement for tommorow," said Jim Benning, a trader at BT Brokerage.

After the close, Microsoft reported record results for the latest quarter that exceeded Wall Street's expectations, with profits rising 42 percent to $562 million. Microsoft ended 3-1/16 higher at 109, equalling its all-time closing high.

Among other technology stocks, Hewlett-Packard rose 1-3/8 to 100 and Intel gained 1-9/16 to 65-3/4.

Motorola rose 2-5/8 to 60-1/8 after it won contracts worth more than $30 million to expand Brazil's cellular phone systems.

International Business Machines edged up 1/8 to 105-3/8 after it tumbled 10-1/4 points Wednesday on its warning that competitive pressures and the stronger dollar would hurt its second quarter results.

Biotechnology issues also enjoyed avid buying interest.

"Biotechs start and end with one word -- Amgen. The rest of the sector is getting dragged along," Orlando said.

Amgen surged 4-1/8 to 57-1/4 after reporting better-than-expected results on Wednesday. Biogen rose 1-7/8 to 60-1/4, Chiron rose 1-1/4 to 94-3/4 and Agouron gained 2-5/8 to 38-1/8.

Oil company stocks slumped but then cut their losses late in the day as crude oil prices pared losses. Crude oil for May delivery closed 85 cents lower at $23.82 a barrel after collapsing to $22.83 on nervousness about the prospects for a U.N. deal on limited Iraqi oil sales.

Dow index components Chevron fell 1/2 to 55-1/2, Texaco lost 3/4 to 84-3/8 and Exxon fell 1-5/8 to 81-7/8.

"There's ongoing constructive movement in energy stocks. I view today as a minor pullback and buying opportunity," said Paul Rabbit, analyst at Oppenheimer & Co.

Analysts said the stock market also drew strength from a surprise cut in German interest rates which injected life into European exchanges.

The German central bank slashed a half-point off its key Lombard and discount rates, boosting business prospects.

Drug stocks jumped as Schering-Plough and Warner-Lambert extended the string of solid earnings from the industry.

Schering-Plough rose 7/8 to 58-1/2, Warner Lambert was up 1-1/8 to 111-1/2, Johnson & Johnson added 1 to 91-5/8, Eli Lilly was up 2-3/8 to 58-7/8, and Merck added 7/8 to 61-1/4.

Among individual issues, Gillette surged 2-7/8 to 52 after it posted on-target earnings and announced a 10 million to 15 million stock buyback.

Transition Systems, a provider of integrated clinical and financial decision support systems for hospitals, climbed 4 to 22 in its first day of trading.

Raychem rose 5-7/8 to 73-1/4 after reporting stronger quarterly results.

Separately, the New York and American Stock Exchanges said they will observe a minute of silence at 10:02 a.m. EDT/1402 GMT Friday to commemorate the first anniversary of the Oklahoma City bombing.

The Standard & Poor's composite index of 500 stocks rose 2.00 points to 643.61. The American Stock Exchange index was up 2.70 to 583.08.

The NYSE Composite index of all listed common stocks rose 0.83 to 345.39. The average share was up 10 cents.

The Wilshire Associates Equity Index -- the market value of NYSE, American and Nasdaq issues -- was 6,372.738 up 27.046 or 0.43 percent.-Reuter