RealTime IT News

Sellers Remain In Control

Stocks fell across the board Friday morning, as stronger than expected domestic growth raised fears of another Fed rate hike in August. Technology and Internet shares continued to fall on earnings concerns.

The ISDEX fell 32 to 700. The Nasdaq lost 133 to 3708. The S&P 500 dropped 21 to 1427, and the Dow fell 71 to 10,514. Volume declined to 490 million shares on the NYSE, but rose to 890 million on the Nasdaq. Decliners led by 2 to 1 on the NYSE and 3 to 1 on the Nasdaq. Second-quarter GDP came in at 5.2%, well above 3.7% estimates, but inflationary measures were more in line with estimates. Michigan consumer sentiment came in slightly above estimates.

A "takeunder" of Alteon WebSystems didn't help. The stock lost 13 1/8 to 129 7/8 despite news that it will be acquired by Nortel . Before Nortel's stock dropped, the offer was barely above ATON's closing price yesterday.

JDS Uniphase fell 7 3/16 to 121 7/16, a day after closing back below its recent breakout point of 130-131.

EarthLink was downgraded by Morgan Stanley Dean Witter to Neutral a day after beating estimates by 7 cents with a 29-cent loss. The stock fell 1 61/64 to 11 9/16.

eToys beat estimates by 2 cents with a 37-cent loss. The stock lost 1/4 to 4 13/16 on a Goldman Sachs downgrade to Outperform from Trading Buy.

Clarent beat estimates by 6 cents with 4-cent earnings. But the stock got crushed, off 23 15/16 to 50 3/16.

Beyond.com beat estimates by 6 cents with a 29-cent loss, but the stock lost 3/32 to 1 5/16. Buy.com beat estimates by a nickel with an 18-cent loss, but fell 9/32 to 4 3/32. iVillage missed by 6 cents with a 94-cent loss, and announced that President Doug McCormick would replace CEO Candace Carpenter, who will remain as chairwoman. The stock lost 21/32 to 5 7/8. EMusic.com beat estimates by 3 cents with a 34-cent loss, but dropped 25/64 to 2 7/32.

HotJobs.com bucked the trend, rising 1 3/16 to 17 3/8 after beating estimates by a penny with a 31-cent loss. But Breakaway Solutions lost 2 15/16 to 25 1/16 despite beatings estimates by 2 cents with a 2-cent loss.

InterTrust reported in line with estimates at a 13-cent loss, and the stock declined 2 3/8 to 14 1/8. DSL.net beat by 2 cents with a 45-cent loss, but the stock dropped 1 11/16 to 5 15/16. Digital River lost 13/32 to 6 13/16 after beating estimates by a penny with a 39-cent loss.

FreeShop.com gained 5/16 to 3 15/16 on news of a 10% stock buyback. Verio rose 7/16 to 54 5/8 on news that NTT has extended its tender offer until August 14.

Internet advertising firms were higher on news of a settlement on consumer privacy issues with the federal government. DoubleClick , which spearheaded the plan, gained 3 15/16 to 38. 24/7 Media added 5/8 to 11 3/4.

Some technical comments on the market: The bulls didn't even put up a fight at Nasdaq 3820 this morning, sending the index all the way to 3668 before turning back up. That number coincides with the 50% Fibonacci retracement level of the gains from 3042 to 4289, but broke important support in the 3696-3725 range. That would appear to set up a test with the critical support level of 3585, perhaps as soon as Monday. A break of that level could send the index all the way back to 3042, if not lower, and would fulfill the move predicted by the break of the bearish rising wedge on Monday. The descent out of a rising wedge is normally rapid, but the Nasdaq hasn't stopped to catch its breath on this one. The bounce could come Monday, but it doesn't look likely today. The ISDEX broke its rising wed