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The Nasdaq, Where the Action's At - Money Matters for 11/2/05
Closing today at its best level in a month, the Nasdaq has recorded double-digit gains in three of its last four sessions and has been outperforming the stodgy Dow stocks and the NYSE Composite recently.
Still the bastion of technology-related stocks, the Nasdaq most active today (by volume) were Symantec (SYMC), Sun Microsystems (SUNW), Sirius Satellite Radio (SIRI), Microsoft (MSFT) and Intel (INTC), demonstrating that tech is still perceived by investors as providing some of the best performance potential of all US equities.
Whether that perception can match up to reality in today's investment climate is anybody's guess, but tech led the boom of the late 90s and despite the pounding freefall of 2000-2001, investors still can't resist the lure of the dotcom generational shift from manufacturing to information technology, computing and internet pure plays.
No doubt, the internet continues to fuel the growth of many companies, and high gasoline prices - which keeps people at home rather than on the road - helps fuel that phenomenon. Internet technology, in particular, has matured to a point at which more and more consumers are foregoing the annual trek to the mall for Christmas shopping, opting instead to do their browsing electronically at sites like shopping.com, amazon.com, eBay and a slew of smaller, specialty merchants and mainline retailers gone high tech.
But beyond the usual suspects are hundreds of small and mid-cap companies which are providing much of the growth in the Nasdaq and contributing to the US economy in ways that are not always readily apparent.
While the largest companies in America are fighting for market share and culling their workforces in search of higher profits, these smaller companies are the ones actually making new discoveries, hiring Americans and growing faster than the rest of the economy.
So, while you look for investment opportunities in the vast expanse that is the world of US stocks (over 6500 listed on the NYSE and Nasdaq combined), bear in mind that larger firms in general have a more difficult time adjusting to changes in the structure of society, and that we are surely in an era of rapid change.
Dow Jones: +65.96; 10,472.73 close
NYSE Advancers: 2430
Nasdaq Advancers: 2135
NYSE New Highs: 169
Nasdaq New Highs: 150
Gold: +4.00; 464.60 close
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