NEW YORK – Technology stocks rose Wednesday after the CEO of Cisco Systems Inc. promised to take "bold steps" to narrow the company's focus.
Cisco rose 5 percent, the most of any stock in the Dow Jones industrial average. CEO John Chambers said in a memo to employees that recent missteps were "unacceptable." Analysts say the company is overly reliant on revenues from state and local governments. Chambers promised that major changes were coming, although he offered few specifics.
Other technology companies also rose. Hewlett-Packard Co. rose 2.2 percent, while Microsoft Corp. and chipmaker Qualcomm Inc. each rose more than 1 percent. Broadcom Corp. gained 3.9 percent after an Oppenheimer analyst said the semiconductor company would benefit from higher sales of mobile phones.
Chip stocks were still a big focus for investors since Texas Instruments Inc. said Monday it would pay $6.5 billion in cash for National Semiconductor Corp.
Materials and energy companies fell. Monsanto Co. lost 5.6 percent after the world's biggest seed company issued an earnings forecast for the year that fell below analysts' expectations.
Energy companies fell the most out of any group within the S&P 500 index. Halliburton Co. and Baker Hughes Inc. each lost more than 2 percent. The Energy Information Administration said U.S. crude supplies grew more than expected last week, rising by 2 million barrels. Analysts expected an increase of 1.3 million barrels. Gasoline demand also dropped by 112,000 barrels per day.
The Dow Jones industrial average rose 32.85, or 0.3 percent, to 12,426.75.
The Standard & Poor's 500 index edged up 2.91 points, or 0.2 percent, to 1,335.54. The Nasdaq composite index rose 8.63 points, or 0.3 percent, to 2,799.82.
Oil prices rose, passing $109 a barrel at one point, as the dollar weakened against major foreign currencies. Oil is priced in dollars and tends to rise when the dollar falls against other currencies. The euro climbed to a 15-month high a day before the European Central Bank was expected to increase interest rates.
Traders want to see how higher prices for oil, gas and other raw materials are affecting corporate profits. They'll get their first glimpse next Monday, when Alcoa Inc. reports its first-quarter earnings, providing the unofficial start of earnings season.
Robert Russell, president of Russell & Co., a wealth advisory firm, said he expects higher commodity prices to hurt profits.
"The U.S. markets are running on fumes at this point," he said. "There's going to be more of a strain on corporate earnings."
Abercrombie & Fitch Co. rose 3 percent after several analysts raised their price targets on the company, citing the retailer's strong 2012 earnings outlook and international prospects.
More than four stocks rose for every three that fell on the New York Stock Exchange. Trading volume was 4.1 billion shares.