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RealTime IT News

IPOs Steal the Show

Two highly-anticipated initial public offerings stole much of the limelight on Friday as stocks jumped higher across the board in large part due to better-than-expected economic news. The Nasdaq Composite also continued its high-flying ways, setting its fifth record in as many days.

internet.com's Internet Stock Index climbed 12.71, or 2.19 percent, to 592.03, the Nasdaq Composite jumped 46.25 to 3,102.20 and the Dow Jones industrial average ended up 64.84 to 10,704.48.

Markets cheered news that the U.S. jobless rate fell to 4.1 percent and wages rose less than expected, easing inflation fears. October's unemployment rate was the lowest since 1970, falling from 4.2 percent in September. The U.S. added 310,000 jobs in October following gains of 41,000 in September. Wages only rose a penny to $13.37 an hour.

The day's big success story was Cobalt Networks Inc. (COBT) The company, which developers server appliances for electronic commerce, skyrocketed 106-5/8 to 128-5/8. The company sold 5 million shares at $22 each. Underwriters were Goldman Sachs & Co. Merrill Lynch & Co., BancBoston Robertson Stephens and SoundView Technology Group.

The day's other Internet IPO also had a solid debut. Online grocer Webvan Group Inc. (WBVN) gained 9-7/8 to 24-7/8 after hitting 34 earlier in the session. The company sold 25 million shares at $15. Goldman Sachs was managing underwriter.

Teligent Inc. (TGNT) vaulted 15-7/8 to 63-7/8. The wireless company is getting a $500 million investment from a group led by buyout firm Hicks Muse Tate & Furst Inc. and Microsoft.

Market watchers will now turn their attention to Microsoft Corp. (MSFT) U.S. District Judge Thomas Penfield Jackson will issue the first of his two-part ruling on the federal government's antitrust lawsuit against the software giant at 6:30 p.m. Eastern. Last month, Jackson announced the ruling would come on a Friday, but would not give a specific date. Microsoft ended the day off 3/16 to 91-9/16.

The first ruling will be a "finding of fact" which will lay out the allegations Jackson believes have been proven during the 76 days of testimony. No formal sanctions will be imposed in the first ruling.

In other sector news, CMGI Inc. (CMGI) inched up 9/16 to 105 and Lycos Inc. (LCOS) had ended up 5/16 to 57-5/16. The Wall Street Journal reported Friday CMGI recently made another effort to buy the search engine although talks ended a few weeks ago after the two sides couldn't come to acceptable terms.

Also Friday, Lycos sealed a deal with Japan's Kadokawa Shoten Publishing Co. Ltd. which will bring content to Lycos Japan. Tripod Japan, a free Web page hosting service, launched earlier this week and has already signed up more than 10,000 members, the company said.

Online brokers were mixed Friday following a report from U.S. Bancorp Piper Jaffray. Online brokerages added 1.1 million accounts in the third quarter, although the average number of daily online trades fell 7.8 percent from the second quarter. Also, a wave of ratings updates from CS First Boston was moving the group.

The biggest gainer among e-brokers was National Discount Brokers Group Inc. (NDB), soaring 6-1/16 to 35-1/16. CS First Boston initiated coverage Friday with a "strong buy" rating.

Charles Schwab Corp. (SCH) fell 1-7/8 to 40-1/8 on news that it continues to lose market share to rivals, although it still holds the top position in the market with a 23.3 percent share. CS First Boston initiated coverage of Schwab with a "hold."

E*Trade Group Inc. (EGRP) lost 5/8 to 30-3/4. That firm led the pack adding new accounts, with 310,000 in the quarter. It came in second in terms of trading volume to Schwab. E*Trade was also started by CS First Boston with a "hold" as was Ameritrade Holding Corp. (AMTD), up 13/16 to 19-7/8.

Finally, in the e-finance sector, DLJdirect (DIR) closed up 1-7/16 to 17-11/16 after CSFB started coverage with a "buy."

Radware (RDWR) was one of the day's biggest losers, falling 7 to 49-1/8. The company, whose products help optimize Internet traffic, lost 1 cent a share in the third quarter. Friday's decline comes after a plunge of 23-7/8 to 56-1/8 on Thursday despite the fact the loss was in line with analysts' expectations.


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