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RealTime IT News

Stocks Sell Off On Good Earnings Reports

Traders continued to sell stocks reporting better-than-expected earnings, and are already looking ahead to third-quarter earnings. Microsoft was one company guiding third-quarter numbers lower, and its stock was hit as a result.

The ISDEX fell 15 to 795, and the Nasdaq dropped 82 to 4094. The S&P 500 declined 11 to 1482 and the Dow lost 35 to 10,704. Volume declined to 421 million shares on the NYSE and 673 million on the Nasdaq. Declining issues led 15 to 10 on the NYSE and 22 to 12 on the Nasdaq. Traders are wary ahead of Fed Chairman Alan Greenspan's Senate Banking Committee testimony on Thursday after yesterday's stronger-than-expected Consumer Price Index. For earnings reports, visit our earnings calendar and reported earnings. Among the companies reporting tonight are ExciteAtHome, About.com, e.piphany, Exodus and PurchasePro.

CNET fell 4 1/2 to 27 11/16 on news that the company will buy Ziff-Davis for $1.6 billion. Each share of ZD common stock will be converted into 0.3397 shares of CNET, and each share of ZDNet will be converted into 0.5932 shares. ZD rose 1 11/16 to 13 1/16 and ZDZ gained 2 7/8 to 15 3/4.

Commerce One reported a loss of 10 cents a share, 3 cents better than estimates, and revenues rose 1,400% to $62.7 million. But the stock dropped sharply, off 7 7/8 to 58 11/16, on concerns about sequential license growth and market share loss. Technical note: the stock's recent breakout from a three-month symmetrical triangle remains in effect as long as the stock stays above the breakout point of $52.

DoubleClick fell 3 7/16 to 32 1/16 despite reporting a second-quarter loss of 3 cents a share, 2 cents better than estimates. But Donaldson, Lufkin & Jenrette noted that the numbers were driven by better-than-expected interest income. ING Barings and USB Piper Jaffray downgraded the stock on concerns about second-half growth.

RealNetworks lost 8 1/4 to 49 3/4 despite reporting earnings of 6 cents a share, a penny better than expectations. CS First Boston reiterated a Buy on the stock. Broadcom lost 5 to 240 3/4 despite beating estimates by 4 cents with 23-cent second-quarter earnings. Merrill Lynch reiterated Buy on Broadcom. i2 Technologies also suffered despite beating estimates, off 7 3/16 to 131 13/16. Foundry Networks fell 20 13/16 to 103 5/16 despite better-than-expected earnings.

A few stocks managed to buck the trend. E*Trade , up 9/16 to 18 1/2, Travelocity.com , up 15/16 to 20, and Digital Lightwave , up 2 3/16 to 116, all rose after beating estimates.

IPO Support.com soared 21 to 35 on its first day of trading.

NetRadio rose 19/32 to 3 on news of an alliance with cable ISP RoadRunner.

Stratos Lightwave rose 6 3/16 to 40 3/4 on BusinessWeek Online comments that the stock was undervalued compared to New Focus , Sonus and Avanex .

Some technical comments on the market: The S&P 500 negated its recent breakout this morning, falling back below the 1488-1490 level. The break of its rising wedge yesterday means the index is likely to return to the 1440 level, where the wedge began, but first it must get through support in the 1475-1480 area. 1470 may a