NEW YORK -- U.S. technology stocks bounced back smartly Friday, driving the Nasdaq market up more than 4 percent, as investors shifted back into "new economy" names and out of some banks and basic materials producers after a gut-wrenching week of wild fluctuations.
Analysts said it was a return to the pattern of trading that has characterized the market for much of this year -- with the Internet-related companies that are seen as having the potential for high returns, though with higher risks, back in favor while blue-chip stocks from traditional areas lagged.
"I felt all along that as soon as you saw Nasdaq regain its confidence, the money was going to come out of the Dow," said Larry Rice, chief investment officer at Josephthal Lyon & Ross. "But this is the kind of market that carries everything to extremes so you have to get used to this volatility."
Producers of software, network equipment and semiconductors all came back into favor as investors signaled they haven't lost confidence in the Internet era despite the recent concern that many of the stocks in these sectors had risen too far, too fast.
The Nasdaq Composite Index rose 178.88 points, or 4.19 percent, to 4,446.44, led primarily by bellwether names, such as computer maker Hewlett-Packard (HWP), which rose 5-1/16 to 123-1/16.
Computer-chip producer Intel (INTC) gained 7 to 136-13/16, while software giant Microsoft (MSFT) rose 3-1/16 to 89-1/16 and Cisco Systems (CSCO),which produces much of the plumbing for the Internet, added 3-1/8 to 74-15/16.
Strength in top technology components helped buoy the Dow Jones industrial average for most of the day, though it ended down 2.79 points, or 0.03 percent, at 11,111.48.
A drop in financial stocks helped to drag the Dow lower, with J.P. Morgan & Co. (JPM) losing 4-3/4 to 129-7/8 and American Express (AXP) slipping 1-15/16 to 139-1/16.
Exxon Mobil (XOM) also dipped 2-3/16 to 79-9/16 as oil prices fell to their lowest levels for five months.
The world's largest aluminum producer, Alcoa (AA), fell 3 to 67-15/16 amidst a drop in base metals prices.
The broader Standard & Poor's 500 finished up 15.01 points, or 1.00 percent, at 1,516.35.
Stocks got an initial jolt from U.S. jobs data showing that non-farm payrolls grew by 416,000 and the unemployment rate remained at 4.1 percent in March. Economists had forecast that payrolls would rise by 376,000 and the jobless rate would dip to 4 percent.
The jobs numbers could be a key for the Federal Reserve as it ponders whether to raise rates again next month to cool the economy and forestall inflation.
The central bank's rate-setting panel next meets on May 16. The Fed has raised short-term rates five times since June 1999, and Wall Street has already factored in another 0.25 percentage point rise.
Fed Chairman Alan Greenspan is to speak about securities market regulation next Thursday before the Senate Banking Committee.
