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RealTime IT News

Out With The Old, In With The New

It's that time of year again when the Nasdaq stock market decides what's hot and what's not.

The annual rebalancing of the Nasdaq 100 - the 100 largest non-financial stocks that trade on the Nasdaq - was announced today, with eight stocks removed and eight added.

In as of Dec. 22 are Marvell , Garmin , CareerEducation , Lam Research , Level 3 Communications , Intersil , ATI Technologies and Research in Motion .

Gone as of that date are ADC Telecom , Brocade , Ciena , Ericsson , Human Genome Sciences , ICOS , Monster Worldwide and RF Micro Devices .

Perhaps not surprisingly, the eight getting tossed outperformed the Chosen Eight by a wide margin today, gaining 0.5% versus a 0.7% loss for the stocks being added to the index.

Traders had time to position themselves for the announcement and probably sold the news. And by the time an index recognizes a trend, it's getting old (remember BroadVision's addition to the S&P 500 three years ago?). Our guess is that the outperformance of the Disgraced Eight will continue for a while.

The broader market added to its gains a day after the Dow's first close above 10,000 since May 2002, as better than expected inflation numbers held sway over an unexpected drop in consumer sentiment.

The Nasdaq added 6 to 1949, the S&P 500 rose 2 to 1074, and the Dow gained 34 to 10,042. Volume declined to 1.21 billion shares on the NYSE, and 1.46 billion on the Nasdaq. Advancers led 21-11 on the NYSE, and 19-11 on the Nasdaq. Upside volume was 65% on the NYSE, and 62% on the Nasdaq. New highs-new lows were 343-11 on the NYSE, and 180-14 on the Nasdaq.

Adobe rose 1% after beating estimates.

Oracle was unchanged ahead of its earnings report Monday night.

China.com surged 10% on Wall Street Journal coverage and plans for a mobile applications spinoff.

UTStarcom rose 5% on positive analyst comments.

Ameritrade gained 6% after raising guidance.

ValueClick fell 3% on an acquisition.

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