RealTime IT News

September Is The Cruelest Month

September added to its record as the worst month for stocks, as an earnings warning from Apple Computer capped off a month in which the Nasdaq lost 12%.

The ISDEX lost 24 to 753, and the Nasdaq dropped 105 to 3672, the S&P 500 declined 21 to 1436, and the Dow dropped 173 to 10,650. Volume declined slightly to 1.17 billion shares on the NYSE and 1.97 billion on the Nasdaq. Advancers edged decliners on the NYSE, but decliners led 21 to 19 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.

Wireless handheld device makers rallied on better-than-expected earnings from Research In Motion , which soared 16 5/16 to 99 3/4. Handspring fell 6 3/8 to 70 after trading as high as 81 1/4, but Palm added 13/16 to 52 15/16. InfoSpace gained 1 1/16 to 31.

Net Perceptions plummeted 7 5/8 to 4 7/8 after warning that third-quarter losses will exceed estimates of a 13-cent loss by 9 to 19 cents.

theglobe.com dropped 7/32 to 25/32 after warning that revenues will be about half of what Wall Street expected.

America Online slipped 1/4 to 54 1/8 on news that the European Commission may approve its merger with Time Warner - if the companies drop the $20 billion merger between Time Warner and EMI.

Looksmart slipped 15/16 to 11 3/16 after announcing the $20 million acquisition of Zeal Media, which allows users to categorize Web site descriptions.

i2 Technologies lost 5 13/32 to 187 3/32 after trading as high as 198 7/8 on a First Union Buy rating and $230 price target. Commerce One lost 1 1/2 to 78 after trading as high as 84 1/8.

Telecom equipment stocks also suffered. Bellwether Cisco Systems fell 4 3/16 to 55 1/4, its low earlier this week. Juniper Networks lost 9 1/16 to 218 15/16 despite positive analyst comments. The stock traded as high as 235.

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

Well, we said yesterday that we weren't sure whether this rally would turn out to be more than a bounce, and so far the results aren't encouraging. However, despite the magnitude of Apple's warning, breadth was pretty good and volume declined from yesterday. Besides, the PC sector hasn't been a market leader in quite some time. If the real leaders like Corning, Juniper or Ariba begin to warn or disappoint, then we'd have signs of real trouble.

We'll focus on the S&P 500, which seems to be dictating the action here. For the second time this week, the index was rejected at its broken May trendline (the upper black line. Also note that critical support, the lower line around 1420 that represents the April trendline, was pierced slightly two days ago; never a good thing). This repeated rejection at a broken uptrend line reinforces the fact the index's current trend is down. To negate that, the index needs to get above 1460 and that broken trendline, which will continue to rise. The S&P 500 also fell back below its downtrend line that began earlier this month. Also not looking good, in that same chart, is the