News that the government won’t seek a breakup of Microsoft did little to help a market worried about economic weakness on Thursday. And Intel’s reaffirmation of revenue guidance after the close was met with a collective yawn.
The ISDEX http://www.wsrn.com/apps/ISDEX/ fell 5 to 143, and the Nasdaq dropped 53 to 1705. The S&P 500 lost 25 to 1106, and the Dow plunged 192 to 9840. Volume declined to 1.34 billion shares on the NYSE, and 1.87 billion on the Nasdaq. Decliners led 21 to 9 on the NYSE, and 25 to 11 on the Nasdaq. 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.
After the close, Intel rose modestly after saying that revenues will come in slightly below the midpoint of estimates. Futures received a small boost on the news, but the August unemployment report tomorrow morning could also be a market-mover. Stocks fell today on news that the all-important services sector continued to weaken. Also after the bell, eBay
fell 3 points after filing to sell $1 billion in stock.
During the day, Microsoft lost 1.34 to 56.40 despite the Justice Department announcement, as traders wondered whether the company’s earnings affirmation yesterday may have been a modest earnings warning.
Manugistics plunged 3.27 to 7.69 on an earnings warning.
Motorola , off 2.46 to 13.94, got clobbered on an earnings warning.
National Semi climbed .30 to 30.52 after matching estimates but lowering forward guidance.
RSA Security lost .86 to 17.15 despite reiterating guidance.
GoTo lost 2.74 to 13.28 on a negative article in Barron’s.
Homestore.com lost .19 to 16.41 despite reaffirming its guidance.
Yahoo climbed .26 to 10.90 on positive comments from Lehman Brothers.
FreeMarkets slipped .08 to 14.95 despite saying it will exceed estimates.
Some technical comments on the market: Note: We include 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
The Nasdaq (first chart) held just above the top of its April 4 gap from 1639-1700 today. A move below 1700 would likely lead to a retest of that April 4 low of 1619-1639. To the upside, first resistance is 1777, and then 1833-1843. The Nasdaq 100 (second chart) filled its April 4 gap today at 1370.75, but set a new closing low of 1361, a negative sign. The S&P 500 (third chart) came within 4 points of filling its April 4 gap at 1103.25, a good sign that the index has some more downside work to do. 1125 is first resistance. The Dow (fourth chart) broke 9869 support; 9869-9920 is now first resistance on the Dow. At this point, a full retest of the April lows (1619-1639 on the Nasdaq; 1080-1103 on the S&P; and 9100-9400 on the Dow) appears to be a given. There is a cycle turn coming up tomorrow-Monday; revisiting those lows in the next day or two could make for a sustainable rally for a change. The only negative is that everyone is watching those levels for a bounce, which means it could come sooner – or later. Breaking those supports on an intraday basis might generate a healthy amount of fear.
Special report: For a free introduction to technical chart patterns and an overview of last year’s action in the stock market, visit http://www.internetstockreport.com/guest/article/0,1785,2571_500051,00.html.
