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Mixed Trading Follows Rally on Wall Street Thursday - 2002-07-25

Early trading was mixed on Wall Street Thursday, following Wednesday's dramatic rally.

Blue chip shares moved back and forth between the plus and minus columns with gains in the financial sector leading the way. Wall Street analysts attribute some of those advances to reassurance from officials at Citigroup and JP Morgan that they are taking steps to rectify questionable practices. The two banking giants have denied charges that they helped the now-bankrupt Enron corporation hide loans.

But news that AOL Time Warner, the world's largest media company, is being investigated by the U.S. Securities and Exchange Commission erased some gains.

Deep declines in computer chip and networking stocks caused the technology-heavy Nasdaq Composite Index to plunge.

Phillip Roth, a technology analyst at the independent Miller Tabak firm, says the technology sector will lag behind in rest of the market when it rebounds.

"Much, much damage was done to the technology sector long-term so it is not surprising that they are going to struggle," he said. " But they will have a temporary recovery, I think."

The markets received a mixed message from the economy Thursday, good news showing that weekly claims for unemployment dropped by 21,000 to the lowest level in 17 months was offset by an unexpectedly high drop: 3.8 percent in orders for durable goods.