Small-Stock Focus: Rare Medium, Arch Wireless Rise; Late Sell-Off Pares Market's Gains
NEW YORK -- Nasdaq and small-capitalization stocks rose solidly, although both groups saw intraday gains pared sharply by the end of the actively traded session.</br></br>The Nasdaq and small-cap markets were driven higher by a rally in technology stocks following release of Ciena's fiscal first-quarter results. The fiber-optic networking-systems company posted earnings that beat analysts' projections, and raised its 2001 revenue-growth forecast. Ciena surged 16% to $89 in Nasdaq Stock Market trading.</br></br>Ciena's outlook contrasts starkly with many recent quarterly earnings reports, which have been characterized by warnings that revenue growth is expected to slow for the first half.</br></br>The Nasdaq Composite Index rose 61.51, or 2.47%, to 2552.91, after posting an intraday gain of 101.69, and the Russell 2000 index of small-cap stocks, at 508.85, gained 5.36, or 1.06%, having been up as much as 6.53.</br></br>Rare Medium Group surged 56 cents, or 24%, to 2.88. The New York Internet-consulting and venture-capital company reported a fourth-quarter loss that was the same as its year-earlier loss, with revenue rising 66%. Analysts said the stock was bolstered by takeover speculation after the company's chief executive reportedly said the company was being approached "with strategic options that we are evaluating very seriously."