New York — Investors hoping for a big interest-rate cut sent blue chip stocks higher Monday, helping Wall Street's major indexes recover after last week's beating.
But analysts warned that the market's mood likely would sour again if the Federal Reserve didn't deliver the aggressive action the market wants.
The Dow Jones industrial average rose 135.70, or 1.4 percent, to 9,959.11. The Dow had drifted lower during the day, and most of its gains came during the last two hours of trading.
Broader indexes also rose. The Nasdaq composite index was up 60.27 or 3.2 percent, at 1,951.18 and the Standard & Poor's 500 index rose 20.28, or 1.9 percent, to 1,170.81.
Much of the gains came in the tech sector, which suffered heavy damage last week.
A series of earnings warnings and cautionary statements from tech companies left the Dow with its biggest weekly point drop ever and pushed the Nasdaq below 2,000 for the first time in 27 months.
On Monday, several large tech companies bounced back as investors decided they were oversold. Oracle, which issued a poor outlook last week, closed up $1.38 at $15.44. Dell rose $1.19 to $24.88, Sun Microsystems rose 88 cents to $19.06, and Hewlett-Packard rose $2.48 to $30.50.
But Intel fell, losing 81 cents to $27.06 after an analyst for U.S. Bancorp Piper Jaffray said personal computer sales could shrink this year.
Financial stocks also rose after Lehman Brothers upgraded its rating on Goldman Sachs, Merrill Lynch and Morgan Stanley just days before the firms report earnings for the three months ending in February.
But the main driver for the late rise in blue chips seemed to be hopes for a rate cut from the Fed. While a rate cut of some kind has been widely expected from today's meeting of the Fed's Open Market Committee, investors debated how big the cut would be.
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