RealTime IT News

Nets Hold Up Well, But Blue Chips Sag

Internet stocks held up well on Wednesday morning, but blue chip stocks sagged under the weight of rising oil prices and a sinking euro.

The ISDEX slipped 1 to 792, and the Nasdaq declined 20 to 3845. But the S&P 500 dropped 18 to 1441, and the Dow lost 138 to 10,651. Volume rose to 485 million shares on the NYSE and 785 billion on the Nasdaq. Decliners led 15 to 10 on the NYSE and 21 to 13 on the Nasdaq. Engage reports earnings tonight, and CMGI and Liberate report tomorrow. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our new after hours trading site.

Amazon.com , off 2 15/16 to 37 13/16, continued to slide on concern about a lukewarm analyst meeting yesterday and the loss of Yahoo's business to Barnesandnoble.com , which gave back 3/16 to 5 3/4. Chase H&Q reiterated Buy on Amazon and expressed faith in the company's ability to execute. Technical note: As we said some time ago, if Amazon bottoms in the 31-36 range in the September-October timeframe, it will form a nice inverse head-and-shoulders bottom.

Yahoo gained 7/16 to 108 1/2 on optimism that Barnesandnoble.com offered the company good terms. At least one analyst thinks the Barnesandnoble/Yahoo deal was a plus for Amazon; click here for the story.

eBay gained 2 1/16 to 67 3/4 on news that the company expects 50% year-over-year revenue growth for the next two years.

PurchasePro bolted 8 3/16 to 69 15/16 on a Lehman Brothers Buy rating and $120 price target.

Handspring gained 6 1/4 to 52 1/4 on a Wall Street Journal report that the company will introduce a $299 device that combines the handheld organizer with the cell phone.

Excite@Home lost 1 1/8 to 15 1/16 after CEO George Bell announced his resignation. Bell will remain chairman through 2001.

NaviSite beat estimates by 5 cents with a 34-cent loss, and Prudential upgraded the stock to Strong Buy, but the stock fell 1 1/4 to 37 5/8.

Homestore.com lost 2 13/16 to 47 3/8 on reports of a Justice Department investigation into the company's competitive practices.

USinternetworking lost 15/16 to 7 1/16 on a First Union Securities downgrade and concerns that the company will miss its numbers.

HearMe fell 2 1/4 to 4 9/16 on a revenue warning. US Interactive also fell on an earnings warning, down 1 3/16 to 2 13/16.

Some technical comments on the market: The Dow became the last of the major indexes to break its uptrend from the spring correction this morning, falling through its March trendline at 10,750. It's hard to imagine the blue chips finding support at this point much above the October 1998 trendline at 10,500. If 10,500 breaks, this market is in trouble. The Dow's decline is not surprising given what we pointed out more than a month ago: that the rally was occurring on very low volume, with more than a few bouts of selling on higher volume. Not a recipe for a lasting advance. However, the descent from 11,400 has been swift and unrelenting, and the Dow has been technically oversold since the 10,800-10,900 area, yet it just keeps going lower. Not good signs. The S&P 500 failed at 1460 resistance, and dropped quickly to 1435-1440 support. Ne