By Clyde Noel

The second quarter is off to a good financial start. Investors gave a positive spin to the four-day trading week and provided the Nasdaq composite index to have its best week of the year.

The economic news on corporate earnings increased suggestions that the economy may slide into recession, but investors are now looking for an interim rate cut before the next Federal Reserve meeting. At this point, investors would rather see signs the economy is beginning to mend.

For the week, the Dow gained 335.85 points or 3.4 percent, the Nasdaq composite gained 241.07 points or 14.01 percent and the Town Crier Index increased 15.18 percent.

Investors are still uncertain where the bottom of the market lies, but they were testing the technology waters again after relentless selling drove the Nasdaq market down to a two-year low last week.

Numerous technology companies listed on the Town Crier Index had a spectacular week. For the week, Adobe Systems increased 20.59 percent; Agilent Corp., 22.16 percent; Applied Materials, 23.68 percent; Cisco, 31.91 percent; Flextron, 45.68 percent; Intel, 19 percent and KLA Tencor, 22.33 percent.

Continuing with the Town Crier Index: Lam Research increased 26.93 percent; LSI Logic, 21.34 percent; Sun Microsystems, 20.86 percent; Varian Semiconductor, 31.43 percent and Yahoo finally received investors confidence creating a 14.52 percent increase.

Portfolio managers are afraid of not recognizing the bottom of the market and are starting to invest again. They have money to put back to work, so they are looking at technology stocks.

The Dow got a lift from General Electric Co. when it posted a 16 percent rise in profits on record revenues. GE, the stellar leader with businesses that range from power generation to financial services and broadcasting, is a company many investors look to as the leader of our future economy.

To conclude the week, many firms have issued warnings and many more may have negative news up their sleeves. Those hidden pieces of negative news-bits make it difficult for the stock market to make any near-term progress.

Equities will likely continue to hack out a bottom for awhile. Signs that the trend in corporate earnings is turning are needed for stocks to mount a sustainable advance.

For the time being, sit tight.

Noel, a seasoned investor, covers the stock market for the Town Crier.