Stocks turned mostly higher today as investors bought beaten-down shares of companies that have faltered during the debate over interest rates. But as the Federal Reserve began its two-day meeting in Washington, many investors were trading cautiously.
At 3 p.m., the Dow Jones industrial average was up 41.58 at 10,982.11. Broader stock indicators were also higher. The Standard & Poor's 500 index was up 4.25 at 1,398.71, and the Nasdaq composite index gained 53.34 to 3,993.69.
After slumping for much of the morning, stocks rose amid a growing sense that despite rising interest rates, which can cut into corporate profits, most U.S. companies will post strong earnings growth throughout the year.
Microsoft Corp., the No. 1 software maker, led the S&P 500 higher, rising 3 3/1 6 to 101 1/1 6. That ended a four-day losing streak in which the shares fell 4.8 percent.
American Express rose 3 1/2 to 168 1/4 , adding to yesterday's 4.1 percent gain. The financial-services company has risen six of the last seven sessions. Both companies have beaten analyst profit expectations every quarter for at least the past three years.
Qualcomm climbed 11 1/4 to 138 1/4 , adding to yesterday's 15 percent gain. The developer of the world's fastest-growing cellular telephone standard, which rose 27-fold last year, fell 37 percent in the first four weeks of 2000.
Merck & Co., the No. 1 U.S. drugmaker, fell for the first time in six days. Shares dropped 1 1 3/1 6 to 76 1 3/1 6, the biggest decline in the Dow average. Merck rose 14.4 percent during its five-day winning streak.
Some newly public companies tripled after starting to trade on the Nasdaq Stock Market for the first time. Sequenom Inc. jumped 50 5/8 to 76 3/4 , Turnstone Systems Inc. jumped 66 5/8 to 96 and Quantum Effect Devices Inc. soared 34 7/8 to 50 3/4 .
Skillsoft Corp. rose 5 1/1 6 to 19 1/1 6 and Impsat Fiber Networks Inc. rose 13 1/2 to 30 1/4 .
Onyx Software Corp. climbed 2 1 5/1 6 to 59 3/1 6. The maker of sales and marketing automation software will split its shares 2-for-1 after they quadrupled since a February initial public stock sale. Onyx rose 1 3/8 to 56 1/4 .