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Stocks Await Cisco's Earnings

Stocks hovered around unchanged on Tuesday ahead of Cisco's earnings report due out after the close.

The ISDEX gained 5 to 75, and the Nasdaq rose 2 to 3865. The S&P 500 was unchanged at 1479, and the Dow added 42 to 10,909. Volume rose to 450 million shares on the NYSE and 681 million on the Nasdaq. Advancers led 13 to 12 on the NYSE, but decliners led 19 to 16 on the Nasdaq. Traders were cheered by a better-than-expected increase in second-quarter productivity. Cisco reports earnings tonight, Applied Materials on Wednesday and Dell Computer on Thursday. For earnings reports, visit our earnings calendar and reported earnings.

NorthPoint slipped 15/16 to 14 1/16 after trading as high as 19 on news that it will merge its DSL business with Verizon . NPNT shareholders will receive $2.50 per share in cash and one share in the new NorthPoint. Verizon will own a 55% stake in the new company. Rhythms rose 13/16 to 13 1/16 in sympathy, but Covad slipped 5/8 to 17 9/16.

PSINet gained 1 3/4 to 20 1/16 after reporting a second-quarter loss of $1.12 a share, 23 cents better than estimates. CAIS Internet gained 5/32 to 9 1/2 after beating estimates by 2 cents with a $1.17 loss.

Ameritrade slipped 1/16 to 13 after CEO Tom Lewis resigned for personal reasons. Chairman and co-CEO Joe Ricketts will fill in on an interim basis.

The IPO of AOL Latin America priced at 8, opened at 7 15/16, and rose to 8 13/16. For more on the stock, which combines the volatility of the Internet with the uncertainty of emerging markets, click here.

DoubleClick lost 3 9/16 to 35 1/16 on news that the company had restructured its agreement with AltaVista.

TheStreet.com gained 1 5/32 to 6 3/16 on news of a $7.5 million investment from Paul Allen's Vulcan Ventures. Also, the company licensed Go2Net's proprietary message board platform. Vulcan took a 5% stake in TSCM, and Vulcan and GNET each took an option to buy an additional 7.45% of TSCM stock within six months at a "substantial premium to yesterday's closing price."

BroadVision , off 1 7/16 to 34, formed an alliance with Commerce One , up 3 1/4 to 53 13/16. Other B2B stocks gaining were Ariba , which rose 7 to 142, breaking above 135 resistance, and i2 , which rose 7/8 to 144 1/4, turning back at 148 1/2 at what appears to be the upper boundary of a rising wedge.

InterNAP gained 1 1/8 to 31 1/8 on a Dain Rauscher Wessels Strong Buy Aggressive rating and $53 price target.

Digital Island gave back some of yesterday's 5-point rise, slipping 1 19/32 to 30 23/32. The company is meeting with analysts today.

Sonus Networks continued to gain on last week's bullish conference presentation, rising 12 1/8 to 273 1/4.

Some technical comments on the market: It may be premature to point out, but the Nasdaq's rally since bouncing off 3521 last week has been forming converging boundary lines. Not a good sign, as it could imply a rally that will soon run out of steam, but it is early enough that the Nasdaq could break out and negate the pattern. Still, it is interesting that it comes right before Cisco's earnings after the close tonight. As we have pointed out before, the Nasdaq has formed no bottom here that is comparable to the inverse head-and-shoulders it formed at its bottom in late May, and we are still waiting for



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