Intel Beats Estimates, IBM In Line

A sharp down day on Wall Street ended on a hopeful note after the close, as Intel beat reduced earnings estimates and IBM matched expectations. i2 Technologies also beat estimates after the close and declared a 2-for-1 stock split.

The ISDEX dropped 36 to 619, or more than 5%, and the Nasdaq fell 76 to 3213. The S&P 500 was down 24 to 1349, and the Dow lost 149 to 10,089. Volume rose to 1.17 billion shares on the NYSE and 1.92 billion on the Nasdaq. Decliners led by 21 to 8 on the NYSE and 27 to 12 on the Nasdaq. There are a lot of big earnings reports this week, including Intel and IBM tonight, and Microsoft and Sun Microsystems tomorrow. The Consumer Price Index tomorrow is the big economic report for the week. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our after hours trading site.

i2 , off 1 1/16 to 183 during the day, hovered around that level after hours after the stock beat estimates by 2 cents with 12-cent earnings and declared a 2-for-1 stock split. Intel rose after hours, but IBM dropped about 8 points from its close on weaker-than-expected revenues.

During the day, America Online dropped 9.17 to 43.44 after Lehman Brothers analyst Holly Becker expressed cautious comments ahead of tomorrow’s earnings report. Becker and Merrill Lynch’s Henry Blodget later said the selling was overdone, but given Becker’s prescient call on Yahoo around 130 some time ago, investors were in a listening mood. Becker also wasn’t finished with Yahoo , issuing more negative comments sent that stock lower by 6 to 49 1/4.

BroadVision surged 2 5/16 to 26 1/8 on news that it will be added to the S&P 500. Juniper Networks , which had been considered the favorite to replace PaineWebber, lost 14 1/2 to 228 1/2. Technical note on Juniper: the stock appears to be forming a broadening top, a 5-point pattern that involves 3 higher highs and 2 lower lows (such patterns are sometimes flat-bottomed or topped, and they sometimes go on to set a fourth high). A close below 174 could send Juniper to 120 or lower.

Interwoven added 3 1/4 to 107 after trading as high as 117 on better than expected earnings, a 2-for-1 stock split, and an alliance with Hewlett-Packard. Internet Security Systems gained 6 1/2 to 87 after beating estimates by a penny with 11-cent earnings.

WebTrends gained 2 9/15 to 25 3/8 after beating estimates by a penny with 9-cent earnings. Marimba dropped 5/8 to 5 1/2 after missing estimates by a penny. Cobalt slipped 1 11/32 to 54 27/32 after beating estimates by a nickel with a 1-cent loss. lost 1 15/16 to 9 1/2 after beating estimates.

Interactive Pictures dropped 2 1/8 to 2 1/8 after announcing a better-than-expected loss but lower-than-expected revenues. dropped 11/16 to 2 1/16 on an earnings warning. fell 1 1/16 to 2 on a better than expected loss, but lower than expected revenues. lost 3 3/4 to 7 after beating estimates but lowering forward guidance.

m added 1/16 to 2 1/8 after beating estimates. Extensity slipped 1 1/8 to 13 1/16 on a better than expected loss.

B2B leaders were weak ahead of earnings reports. Ariba , which reports tomorrow, lost 3 7/8 to 127 1/2, Commerce One , which reports Thursday, dropped 4 1/8 to 64 1/2, and PurchasePro , which reports tonight, gave back 3 3/4 to 41.

Some technical comments on the market: Note: We are now including charts with the technical market commentary; just click on the links in the story below to go to them. If you have trouble accessing the charts via the e-mail newsletter version, try this link:

Not a great day, but so far the Nasdaq is holding up fairly well. Interesting where the selling ended on the Nasdaq today: at 3173, right about at the point where it broke out of a falling wedge last Friday. A break above 3425 would take out the downtrend line, and give the index room to as high as 3800. Major resistance could be found at 3500, around the August 3521 bottom and the 38% Fibonacci level from the 4259 to 3054 decline (3511). To the downside, the double bottom around 3050 (3042 and 3054) is critical support. Absolutely critical.

The S&P 500 finished right on its 1994 logarithmic trendline at about 1350, a very important level. The index found support last week at 1329, just above its Februrary bottom at 1325. A close below 1323, or 2% below the 1994 trendline, would be a big negative. To the upside, the S&P’s downtrend line is around 1385; the index has turned back around 1380 a few times.

The ISDEX is back below its September downtrend line just under 650. Next support is 600, and next resistance after 650 is 700. The Dow broke down out of a bear pennant today, with potential downside to as low as 9500-9900. So far the previous low at 10,014 is holding. To the upside, the index needs to get above 10,300 to have any room to run.

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