Finally, A Bounce

Stocks finally bounced on Thursday, as investors waded back into technology and Internet stocks battered by four months of relentless selling.

The ISDEX rose 13 to 349, and the Nasdaq climbed 66 to 2399. The S&P 500 climbed 15 to 1279, and the Dow gained 143 to 10,462. Volume was unchanged at 610 million shares on the NYSE and 1.2 billion on the Nasdaq. Advancers led by 14 to 11 on the NYSE, but decliners led 19 to 17 on the Nasdaq. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our after hours trading site.

Liberate , up 2 3/4 to 13 3/4, led the ISDEX higher after blowing out earnings estimates and raising forward guidance.

B2B stocks were back in favor, led by i2 , which surged 6 7/8 to 43 7/8. Ariba rose 2 5/16 to 49 9/16, back above 49 support.

Cisco Systems led infrastructure stocks higher, climbing 2 11/16 to 39 3/16.

But the rising tide did not lift all boats. eBay recovered 4 1/16 to 32, but Yahoo slipped 15/16 to 27, and lost 1/2 to 16 3/16.

PDA stocks were weak despite better-than-expected earnings from Palm , off 10 1/16 to 28 1/16, and Research In Motion , down 6 to 69. There were concerns about Palm’s revenues and margins. Handspring fell 4 1/8 to 40.

RealNetworks plunged 4 1/8 to 5 13/16 on an earnings warning. Akamai lost 1 3/4 to 22 1/4, and Digital Island slipped 11/32 to 3 1/4. rose 21/32 to 2 11/32 after approving a $10 million share buyback program.

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Note: The technical market commentary will not be published the next two trading days (Friday and Tuesday). Happy Holidays to all.

The Nasdaq is holding its 1990 logarithmic trendline so far. A very important line, and one we’ve never ended a month below. Given that the next week or so is historically the most positive of the year, it’s a good bet that we won’t close the year below that line. A retest in January is not out of the question, however. The Nasdaq also found support on a line with the early 1999 lows; a pretty potent combination between the two. A close above 2523 would make the index look pretty good. The ISDEX faces resistance at 360, 380 and 400; back above 400 and that index also begins to look pretty good.

The S&P 100 and S&P 500 found support at a pretty strong level, 650 and 1250, the October 1999 lows. A close back above 685 and 1300, respectively, would be pretty positive developments.

The Dow continues to be the best-looking index. It held critical 10,300 support, and is forming a 600-point rectangle between 10,300 and 10,900. A clean break of either range will likely lead to a 600-point move in the direction of the break.

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.c


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