Internets Rebound on Rate Decision
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Internet stocks rebounded solidly after the Federal Reserve's decision on short-term interest rates.
The Federal Reserve raised the short-term rate by a quarter point to 5 percent. More importantly, however, investors cheered news that the board's governors adopted a neutral bias. That means no additional rate hikes are imminent.
internet.com's Internet Stock Index zoomed up 31.88, or 6.10 percent, to 554.15, the Nasdaq climbed 44.30 to a record 2,686.41 and the Dow Jones industrial average jumped 155.45 to 10,970.80
The vast majority of the sector's stocks ended in the black, including all the leaders. America Online Inc. (AOL) gained 4-1/2 to 110-1/2, Amazon.com Inc. (AMZN) climbed 9-1/16 to 125-1/8 and Yahoo! Inc. (YHOO) was up 12-1/4 to 172-1/4.
Excite@Home Corp. (ATHM) gained 2 to 53-15/16. Excite announced a deal with Billpoint that will allow users of Excite's classifieds and auctions service to use Billpoint's person-to-person payment service as currency.
Internet advertising agency Modem Media.Poppe Tyson Inc. (MMPT) dropped 2-5/16 to 22-7/8 on word the company had lost its AT&T Corp. contract.
Healtheon Corp. (HLTH) gained 2-3/16 to 77 after being in the red earlier. The company, which uses the Internet to link doctors with insurers and patients, hinted it may be eyeing more acquisitions. Its $10.3 billion buy of WebMD is still pending.
National Discount Brokers Group Inc. (NDB) soared 12-3/4 to 58. Piper Jaffray's Stephen Franco initiated coverage of the stock, setting a $90 price target. Others in the sector moved up as well with E*Trade Group Inc. (EGRP) up 3/4 to 39-15/16 , DLJdirect (DIR) gained 2-9/16 to 29-1/2 and Ameritrade Holding Corp. (AMTD) jumped 13-9/16 to 106. Southwest Securities Group Inc. (SWS), which owns Mydiscountbroker.com jumped 10 to 71-9/16.
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