Blue-chip stocks spent almost all of Thursday well into bear territory before a late-day rally helped them escape. Meanwhile, tech and Internet stocks gained ground as nervous investors continued to look for signs of relief.
The Dow Jones fell 97.52 to 9389.48, just 11 points above the 9378.38 mark (20% below its all-time high of 11,722.98 on Jan. 14, 2000) that would officially signal a bear market for blue chips. As late as 3 p.m., the Dow was at 9107, its lowest intraday price since February 1999. The S&P 500 inched down 2.67 to 1119.47.
The Nasdaq climbed 67.48, or 3.7%, to 1897.71, while internet.com’s Internet Stock Index gained 8.04, or 3.9%, to close at 212.29.
Despite the Nasdaq and ISDEX overall gains, there were more decliners than advancers among tech and ‘Net tickers. Only the Search/Portals (eight of 11) and Speed/Bandwidth (15 of 24) sectors had more winners than losers Thursday, while the Security group (seven up, seven down) was a wash. For all sector breakdowns, visit this site.
High-speed chipmaker Broadcom
was the most significant gainer among ‘Net stocks, moving up by 19.8% to $37.88 one day after announcing that Q3 and annual losses in 2000 narrowed due to a change in the company’s accounting method. Though the change also lowered Q4 revenues by nearly 10%, the market
focused instead on the improvement in the bottom line of 3 cents per share in Q3 and 2 cents per share for the year.
Asian ISP Internet Initiative Japan
shot up 30.9% to $11.13 on a story in a Japanese newspaper that it may be acquired by Cable & Wireless Plc.
Streaming media content provider Visual Data
bounced off Wednesday’s all-time low close of $1.06 to finish at $1.38, a 29.4% gain.
Three days after the company said shares were essentially worthless and that it was looking for a buyer, PSINet
soared 46.2% to 19 cents as some investors hoped for an acquisition that would result in a quick profit.
The biggest loser among ‘Net tickers Thursday was Web advertising player 24/7 Media
, which on Wednesday reported disastrously heavy Q4 losses of $677 million, or $15.96 per share, compared to a loss of $13 million, or 58 cents per share, in the year-ago quarter. TFSM closed Thursday at 41 cents, a drop of 42.2%.
Personalization software maker Net Perceptions
plummeted 34% to $1.03 after announcing it would fire nearly half its workforce and expects a Q1 loss of 42 cents to 46 cents per share.
Here’s a bit of technical analysis, courtesy of the fabulous Paul Shread…
March 22, 4 p.m.: We may have gotten our reversal right on schedule today. We hope. But first the indexes need to get just a little bit higher. The S&P 500 (first chart) needs to get back above 1130 to have
any room to run, and the Nasdaq 100 would have a major breakout just 50-75 points from here (second chart), at about 1750-1775. Finally, with the Dow’s return to the 9100-9350 level, all the major indexes have now
retouched their mid-1998 highs (third chart), a good place for some sort of a bottom.