A strong early rally on the merger of Lucent
gave way to profit-taking Monday, with all but blue chip stocks ending the day in the red.
The major indexes were up about 1% in morning trading on news of the merger, but spent the afternoon on the defensive.
The news was little help for other telecom equipment makers, most of which ended the day flat or down, and shares of big customers such as AT&T
were mixed, as traders were unsure of the merger’s effect on the competitive landscape.
Alcatel shares gained the most from the deal, rising 5% on bigger than expected cost savings and the presumption that it will control the merged board of directors.
The Nasdaq lost 3 to 2336, the S&P 500 added 3 to 1297, and the Dow gained 35 to 11,145. Volume rose to 2.45 billion shares on the NYSE, and 2.04 billion on the Nasdaq. Decliners led 17-16 on the NYSE, and 19-11 on the Nasdaq. Upside volume was 61% on the NYSE, and 39% on the Nasdaq. New highs-new lows were 278-57 on the NYSE, and 261-29 on the Nasdaq.
tumbled on their outlooks.
lost 2% on reports of a weaker than expected quarter.