RealTime IT News

Traders Sell The News

The Federal Reserve gave traders everything they wanted on Wednesday: they cut short-term interest rates by 50 basis points and announced their willingness to cut rates further if necessary. But traders sold on the news, sending technology and Internet stocks lower in rising volume.

The ISDEX http://www.wsrn.com/apps/ISDEX/ lost 16 to 421, and the Nasdaq fell 65 to 2772. The S&P 500 declined 7 to 1366, but the Dow added 6 to 10,887. Volume rose to 1.3 billion shares on the NYSE, and 2.4 billion on the Nasdaq. Advancers led 17 to 13 on the NYSE, but decliners led 20 to 17 on the Nasdaq. Fourth quarter GDP came in much lower than expected at 1.4%, the slowest rate of growth for the economy in six years. For earnings reports, visit our earnings calendar at http://www.wsrn.com/apps/earnings/internet.xpl and reported earnings at http://www.wsrn.com/apps/earnings/ireported.xpl. For after hours quotes and news, visit our after hours trading site at http://www.afterhourstrading.com.

AOL Time Warner , off 1.75 to 52.56, matched 15-cent estimates and affirmed full-year views. On a combined basis, the companies earned 28 cents a share.

Amazon.com fell 1 15/16 to 17 after beating estimates by a penny with a 25-cent loss, but the company warned that first quarter revenues will be 15-20% below estimates. Amazon said it will cut 1,300 jobs, or 15% of its workforce, and said it still expects to reach profitability by the end of the year.

Adobe , off 8 3/4 to 44, and Applied Materials , down 2 3/32 to 50 11/32, also warned. Advanced Fibre rose 3 3/16 to 23 3/4 after beatings estimates, but Aware , off 4 7/8 to 16, and PeopleSoft , down 7 7/8 to 41 1/16, didn't fare as well despite better than expected results.

RealNetworks , down 17/32 to 10 7/32, matched estimates. Digital Island , up 1/32 to 6 1/32, said it expects to breakeven by mid-2002 and has the cash to get there.

Broadcom fell 3 to 109 15/16 after trading as high as 121 3/16 on rumors of a deal with Cisco .

New Focus soared 10 7/8 to 60 1/4 after blowing away estimates by 7 cents with 4-cent earnings. TIBCO dropped 7 7/8 to 38 on negative comments from Morgan Stanley.

DiamondCluster , up 2 13/16 to 35 1/2, matched estimates and lowered forward guidance. F5 Networks , up 1 3/8 to 17, topped estimates, as did Oplink , up 1/16 to 19 15/16, and Digital Impact , up 1/2 to 4 5/8.

PurchasePro slipped 1 to 26 1/2 on an expanded relationship with AOL Time Warner, including PPRO's first offline advertising campaign.

Genuity , off 1/8 to 4, met estimates but lowered forward guidance. eLoyalty climbed 1 25/64 to 10 3/8 on a positive preannouncement.

NetPerceptions , off 1/16 to 3 1/2, and Autoweb.com , down 1/16 to 15/32, both fell on earnings warnings. LifeMinders , down 1 to 2 3/4, missed estimates by a wide margin.

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

Note: There will be no technical commentary tomorrow; it will return on Friday.

The bulls couldn't have asked for a better set-up heading into the Fede