The Nasdaq-100 After Hours Indicator, which measures late action in the tech sector, edged barely higher.

Earlier, upbeat earnings from Dow components Merck and Procter & Gamble along with bullish confidence numbers triggered a broad market rally. See Market Snapshot.

The Nasdaq Composite closed up 17 points, or 1.3 percent, to close at 1,342 while the Dow Jones Industrial Average tacked on 99 points, or 1.2 percent, to finish the day at 8,089.

Veritas struggles

Leading the Island ECN's most actives, Veritas Software shares (VRTS) fell to $17.85 from their close at $18.72 after the computer software storage maker reported pro forma earnings of $74.5 million, or 18 cents a share in the fourth quarter, up from $66.0 million, or 16 cents a share, a year ago. Analysts had expected Veritas to earn 14 cents a share. See full story.

Earlier this month, Veritas said it would restate quarterly financial results from the end of 2000 through September 2002 to reflect accounting changes related to two transactions with media giant AOL Time Warner

Including $100 million for restructuring and related tax adjustments, and $35 million in purchase accounting adjustments, Veritas lost $49 million, or 12 cents a share in its fourth quarter. The company lost $202 million, or 50 cents a share, a year earlier.

The company said revenue rose 8 percent to $405 million, but that software license sales, the key demand measure for most software companies, fell 1 percent to $264.4 million. The company's services revenue, however, increased 33 percent to $141.3 million.

"We are encouraged by what we saw in the fourth quarter," said Gary Bloom, Veritas Software's chief executive, in a conference call. "However, one quarter does not make a trend. ... With that said, our optimism for 2003 has improved since the last earnings call."

The maker of data storage-management software reported pro forma earnings of $74.5 million, or 18 cents a share in the fourth quarter, excluding charges, up from $66.0 million, or 16 cents a share, by the same measure a year earlier. Analysts had expected Veritas to earn 14 cents a share, on average, according to analysts polled by Thomson First Call.

The company forecast first-quarter sales of $370 million and pro forma earnings of 13 cents a share. Analysts polled by Thomson First Call had been expecting earnings of 13 cents, based on sales of $364.3 million.

Veritas shares fell (VRTS: news, chart, profile) 5 percent to $17.76 in after hours trading. Shares had risen 65 cents, or more than 3 percent, to close at $18.72 in the regular Nasdaq session.

Bloom said the company continues to increase sales of storage software that it made available for the Linux and IBM AIX operating systems last year. He said the company also sold more software for use with multiple operating systems in the quarter.