Investor Worries Create More 'Net Ticker Woes

The damage varies depending on the sector, but details don't much matter during a freefall. The bottom line is that Internet stocks once again can't find a bottom, with all 13 sectors posting losses this week, though some weren't egregious.

However, it's actually worse than it looks (if you can believe that), since many of the big gainers this week are from the ranks of the Living Dead, those stocks that HAVE hit bottom, usually somewhere south of $2 per share.

Make no mistake, a little bouncing around in the basement can really skew the numbers. Example No. 1: This week's top percentage gainer, soaring 51.6%, is online lender Mortgage.com, which a month ago announced it would wind down its lending operations and lay off 84% of its staff. Shares are down 99.2% this year, and MDCM's Internet-leading gain this week results from the stock rising to nearly 5 cents from 3 cents. Not exactly a feel-good comeback story.

Then there's data management software provider PASW, the runner-up this week with a 41.2% gain. Even with that big jump, shares are only at 75 cents, leaving the stock down 86.8% for the year.

Stepping back a bit, the mini-rally that began in late October and gave investors visions of a belated fall run-up is now ancient history, as only 21 'Net tickers, or about 5%, have posted gains in the past month.

When will things turn around? Not anytime soon, I fear, given the growing list of factors - contested election results, earnings warnings, fears about interest-rate hikes, heavy margin calls and, perhaps most significantly, concerns about a slowing economy - exerting tremendous downward pressure on the market.

Maybe if the Fed later this month changes its stand on interest rates, or even lowers them, that will help. Until there is a clear bottom, investors should focus on some of the profitable big players that have taken hits this fall. Companies such as America Online and eBay are at or near 52-week lows, while Inktomi is at its cheapest price in nearly two years. There are many other companies that stand to survive the shakeout and prosper. The real money over the long-term comes from betting on the winners, not hoping for miracles.

PERSONAL NOTE: This will be the final edition of Internet StockTracker. Beginning Monday I will be writing The Morning Report.

*Market Cap figure is in millions unless otherwise noted.

  
PERFORMANCE BY SECTOR
                          Ave. 7-Day
                           % Change

Financial Services           -1.9%
Advertising/Marketing        -3.7% 
Search/Portals               -5.1%
Performance Software         -7.1% 
E-tailers                    -8.1%
Consultants/Designers        -8.9%
Content/Communities          -9.6%
Internet Services            -9.6%
Speed/Bandwidth              -9.7%
E-commerce Enablers         -10.1%
Security                    -10.7%
ISPs/Access Providers       -12.9%  
Wireless                    -13.8%
 
TOP 10 GAINERS              7-Day % Gain     Category

MDCM    Mortgage.com            50.1%        Financial Services
PASW    PASW                    41.2%        Performance Software
RAMP    Ramp Networks           36.7%        Speed/Bandwidth
CSAV    coolsavings.com         34.4%        Advertising/Marketing
VCLK    ValueClick              32.2%        Advertising/Marketing
VCNT    Vicinity                27.8%        Internet Services
CFLO    CacheFlow               23.0%        Speed/Bandwidth
PPRO    PurchasePro.com         22.7%        E-Commerce Enablers
SFTY    eSAFETYWORLD            22.2%        E-tailers
SPLN    SportsLine.com          22.2%        Content/Communities

TOP 10 LOSERS               7-Day % Loss     Category
 
VCIX    Virtual Communities    -75.0%        Performance Software
RSNT    Resonate               -60.5%        Speed/Ban