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Yahoo Drops, But Nets Rebound

Yahoo fell on concerns about slowing Internet advertising spending, but the ISDEX managed to post a gain for the day.

Technology shares recovered from a two-day sell-off, but the Dow traded lower on an earnings warning from DuPont. The ISDEX recouped 11 to 820, while the Nasdaq rose 85 to 4098. The S&P 500 recovered 10 to 1502, but the Dow declined 50 to 11,259. Volume declined to 978 million shares on the NYSE and 1.61 billion on the Nasdaq. Decliners led 15 to 12 on the NYSE, but advancers led 22 to 17 on the Nasdaq. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our new after hours trading site.

Yahoo fell 4 15/16 to 107 1/8, but off its low of 104 1/4, after the company clarified CEO Tim Koogle's comments about slowing Internet advertising spending made yesterday at the Robertson Stephens Internet Conference in San Francisco. Koogle was initially reported by Dow Jones as saying that advertising is weak and he sees a decline in ad spending in the near term, but what he said was that the period of consolidation in online advertising has taken away some of the upside. Lehman Brothers, which began the stock's recent slide with negative comments about the tough advertising environment, said it does not believe Yahoo's near-term results are at risk.

But Koogle's speech and an earnings warning from Avenue A was enough to send shares of Internet advertising firms lowers. Avenue A, off 7/16 to 7 13/16, said third quarter revenue will come in $10 million less than expected at $44 million. DoubleClick lost 1 3/16 to 36 1/4, and Engage was off 1 1/16 to 11 1/2. But 24/7 Media bucked the trend, up 1 1/16 to 13 1/2.

CMGI lost 3 9/16 to 43 1/8 on news of a restructuring. For more on the story, click here.

MP3.com lost 1 11/16 to 6 3/16 on a judge's ruling that the company's copyright infringement was willful. The company was ordered to pay $25,000 for each CD infringed. MP3 had argued that any fine greater than $500 per violation would bankrupt the company. Liquid Audio , off 1 3/16 to 7 5/16, and EMusic , down 1/8 to 2 5/16, pulled back after rallying on the news yesterday. For more on the story, click here.

Broadcom rose 9 1/8 to 235 on a bullish presentation at a Salomon Smith Barney conference. Covad climbed 2 1/16 to 19 5/16 after telling a Bear Stearns conference that it expects to meet or exceed estimates this quarter despite the Verizon strike.

Internet consultants continued to deliver bad news to investors. Organic slipped 9/32 to 5 1/32 after warning that it will post a loss for the quarter instead of the 2-cent profit expected by analysts. The company expects revenues to rise 5% sequentially, better than the declines predicted last week by Viant and iXL . iXL slipped 3/8 to 6 9/16 after announcing the layoff of 350 employees.

Interactive Pictures gained 1 to 9 after agreeing to provide virtual tours on Yahoo Real Estate.

Peapod , up 1/16 to 2 1/16, announced that it was acquiring the Chicago and Washington, D.C. operations of Streamline.com , off 7/32 to 25/32, and exiting the Ohio and Texas markets.

Retek bolted 9 1/8 to 41 1/4 on news of an expanded alliance with IB