Tech stocks continued their retreat Tuesday as the Fed Open Market
Committee soap opera persisted with just a week left before the markets are
treated to another rate hike. CPI numbers out Friday added fuel to the
sell-off.
Investors were busy hedging positions ahead of May 16th, and tech stocks
led the way lower, as the ISDEX eased 2.49%. Blue chips gave up the ghost
after an early morning rally, sending the NYSE tumbling 66.88 to 10,536.75.
Tech stocks were underwater for most of the trading day with the Nasdaq
shedding another 84.54 to 3,584.84.
Investors anxiously awaiting earnings from Cisco Systems due out after the bell, weren’t disappointed. The world’s
second largest company was largely expected to deliver a $0.13 per share
profit, and the blue chipper that has met or beat its estimates over the
last eight quarters, made certain this latest was no exception.
The networking giant beat expectations by a penny, reporting $0.14 per
share. On the heels of the news, Cisco was marginally higher in after-hours
trade.
Shares of Excite@Home finally showed some signs
of life, climbing 2-7/16 to 19-15/16, on reports that Comcast may have its eye on buying out AT&T’s
majority stake in the pipes and content provider. Both companies declined
to comment on the speculation. A change in ownership is just what
Excite@Home needs, and investors are crossing their fingers on a deal
materializing.
Earthlink tacked on 1-7/16 to 18-7/16, on news
that phone giant Sprint will invest $431 million
for a quarter stake in the ISP after its merger with Mindspring is
finalized. The announcement comes at an opportune time when other Net
stocks are revealing empty bank accounts. Earthlink/Mindspring will have
about a billion on hand after the Sprint investment.
PSINet surged 2-5/8 to 26-15/16, following the
company’s better-than-expected quarterlies announced after the bell
yesterday. The commercial Web host beat consensus estimates by about a
quarter, with a per share loss of $1.06, and an operating loss of $159
million.
EBay plunged another 7-5/16 to 121-3/16, as
shares of the online auctioneer broke through key support levels not seen
since late-August. The company’s dismal slide is in lock-step with the
broader market, as the stock is more than half off its 52-week high of
249-3/4.
Without much room left to fall, shares of Quepasa.com sank a half point to 3-5/16, after the Latin American portal
announced plans to give its workers the entire summer off. The start-up
will deliver pink slips to roughly a third of its employees over the next
two months in an effort to trim spending until its stock price can support
a secondary.
