RealTime IT News

Earnings Warnings Rattle Investors

Stocks fell across the board in rising volume on Tuesday, as earnings warnings from Lexmark and Eastman Kodak unnerved investors.

The ISDEX fell 14 to 779, and the Nasdaq lost 52 to 3689. The S&P 500 fell 11 to 1427, and the Dow dropped 176 to 10,631. Volume rose to 1.1 billion shares on the NYSE and 1.8 billion on the Nasdaq. Decliners led 15 to 12 on the NYSE and 25 to 14 on the Nasdaq. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our new after hours trading site.

Only nine ISDEX stocks finished higher. Phone.com gained 4 1/4 to 120 1/8. Investors have been buying the stock since its announced merger with Software.com was warmly received. Other ISDEX stocks that have been strong lately and continued to show strength today include: i2 , up 1 1/2 to 184 1/8, Broadcom , up 4 3/4 to 257, and Juniper Networks , up 2 3/8 to 230 1/4.

Better-than-expected earnings from Palm did little to help the negative mood in the market. Palm rose 3 1/4 to 55 1/2 after reporting earnings of 4 cents a share, 2 cents better than analysts expected.

Bellwether Cisco Systems fell 2 to 55 3/16 a day after closing below 60 and 58 support. Critical support on Cisco is 50.

eBay fell 2 1/8 to 70 1/4 despite positive comments from Goldman Sachs. Yahoo slipped 2 3/4 to 102 3/4, hovering above its May and August bottoms of 99 1/2-99 3/4.

Entrust surged 4 1/4 to 27 1/16 on news of an alliance with Motorola to develop next generation wireless solutions.

Internet Capital Group fell 3 5/16 to 17 11/16 on cash burn concerns. Investors also sold shares of VerticalNet on the assumption that parent company ICGE will have to sell some of its 24 million shares of VERT to raise cash. However, Gerard Klauer said it doesn't expect ICGE to sell VERT shares, and called the sell-off a buying opportunity.

S1 Corp. lost 1 5/16 to 11 1/4 on an Adam Harkness downgrade from Accumulate to Market Perform. The firm doesn't believe S1 will have a critical mass of customers using its software until 2002.

The IPO of CoSine Communications priced at 23, opened at 67, and closed at 62 1/2. Another recent IPO, OmniSky , continued to draw buyers, rising 1 1/16 to 22 5/8.

Telescan lost 5/16 to 2 7/8 after GlobalNetFinancial.com , up 1/8 to 7 5/16, terminated the companies' merger agreement, saying the companies would do better to pursue their strategies separately.

NBC Internet gave back 5/8 to 7. ABN Amro began coverage with a Hold, saying the company will need time to realize benefits from its new strategy announced yesterday.

Wavo gained 1/8 to 13/16 on news of an XML-based content delivery deal with Dow Jones & Company.

Some technical comments on the market: Note: We will now be including charts with the technical market commentary; just click on the link in the story below to go to them. If you have trouble accessing the charts via the email newsletter version, try this link: http://www.afterhourstrading.com/column.html

The Dow, Nasdaq and S&P all ended the day right above critical support. Again. This constant pounding of critical support levels is beginning to look like the market wants to go lower. Compounding the problem is the lack of fear that helps form a bottom, but we'll get to that in a minute.

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