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RealTime IT News

Nets Again Lead The Pack

Internet stocks continued their sudden resurgence on Thursday, rising another 3%.

The ISDEX gained 21 to 642, and the Nasdaq rose 67 to 3400. The S&P 500 added 4 to 1425, and the Dow slipped 10 to 10,888. Volume declined to 530 million shares on the NYSE, but was unchanged at 1 billion shares on the Nasdaq. Advancers led by 14 to 11 on the NYSE and 21 to 13 on the Nasdaq. October unemployment data is due out tomorrow morning. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our after hours trading site.

Liberate was the latest beaten-down Net name to lead the ISDEX higher, rising 2 5/16 to 20 15/16.

Saudi Arabia Prince Alwaleed bin Talal, undeterred by his failed investment in Priceline.com in the mid-20s, announced that he will double his investment in America Online to $2 billion. AOL rose 1.70 to 53.70.

PSINet imploded 3 3/4 to 3 1/32 after the company warned that it would miss 4th-quarter estimates, and announced that president and CEO Harold Willis will step down.

Foundry Networks rose 6 1/2 to 82 3/8 on a Lehman Brothers Buy rating.

Genuity slipped 1/16 to 6 1/8 after beating estimates by 3 cents with a 24-cent loss. NetZero lost 3/32 to 1 25/32 after beating estimates by 3 cents with a 22-cent loss. Looksmart , up 1 1/16 to 9 15/32, beat estimates by a nickel with a 7-cent loss.

BroadVision rose 1 1/2 to 32 7/8 on an alliance with IBM .

InterTrust added 3/8 to 10 3/8 on a Wall Street Journal story that said the company could benefit from the alliance between Napster and Bertelsmann to encrypt music files to be sold through subscriptions.

Handspring surged 9 9/16 to 81 3/8 on a CIBC Strong Buy rating and $90 price target.

Internet infrastructure leaders rebounded. Cisco Systems , which reports earnings Nov. 6, rose 2 5/16 to 54 7/16. JDS Uniphase gained 2 1/16 to 80 5/8, and Juniper Networks rose 8 5/16 to 191 11/16.

Red Hat added 1 1/2 to 16 13/16, continuing to gain on comments from a Microsoft official that Linux on the PC represents the greatest threat to the software giant.

Some technical comments on the market: Note: We are now including charts in the technical market commentary. If you can't get the charts via the e-mail newsletter version, try this link: http://www.afterhourstrading.com/column.html

Special report: For a free introduction to technical chart patterns and an overview of this year's action in the stock market, visit http://www.internetstockreport.com/guest/article/0,1785,2571_500051,00.html.

We're already seeing signs in this rally that we don't like. We'll focus today on the large-cap Nasdaq 100. The index filled a gap at 3326 today that had formed an island reversal, and then pulled back, failing to take out its highest downtrend line. But the bigger problem is the small bear pennant that is forming off the lows; given the 500-point "pole" on that pattern, a break of 3200-3250 could carry the index as low as 2700. Also, if the Nasdaq and Nasdaq 100 fail to take out their recent highs around 3500, we would continue to have a cycle of lower highs, which is also a negative. Given that the only thing on the