Net Stocks Slump After Positive Open

U.S. stocks were trading slightly below water at midday Wednesday after getting an earlier boost from new statistics that show the economy may be slowing enough to keep inflation at bay.

At 11:30 a.m. Eastern,’s Internet Stock Index had fallen 3.20, or .49 percent, to 647.20, the Nasdaq Composite was off 9.00 to 3,450.48 and the Dow Jones industrial average had dipped 1.03 to 10,526.10.

The Commerce Department reported Wednesday new home sales declined 5.8 percent in April, due to higher mortgage rates. Home sales came in at a seasonally adjusted rate of 909,000 down from a revised 965,000 in March. April’s number was about 30,000 lower than consensus estimates.

Internet stocks posting solid moves included , jumping 1-19/32 to 6-27/32. The company said it expects to beat analyst estimates when it reports quarterly results June 30. The company says revenue will come in between $13.5 and $14 million.

Starmedia Network had gained 1-11/16 to 17-15/16. CS First Boston initiated coverage of the Latin American portal with a “buy.” The brokerage expects the stock to hit $29 over the next 12 months. Ltd. had jumped 1-7/16 to 11-1/2. The Internet job site was upgraded to “buy” from “neutral” by PaineWebber. The firm’s Kelly Flynn set a one-year price target of $15.

American depositary receipts of were up 1/2 to 9-3/8. The U.K. auction site reported fourth-quarter revenue grew 40 percent to $3.4 million. Its operating loss was $16.4 million, or 11.1 million British pounds.

WaveRider Communications Inc. had gained 1-3/8 to 6-1/4. The provider of wireless Internet access received government approval to sell its products in China.

Stocks in the red included Lucent Technologies , off 3/4 to 57. The company Wednesday purchased Chromatis Networks for $4.5 billion in an effort to boost its optical networking line.

Ask Jeeves Inc. had lost 1-13/16 to 19-13/16. The search engine announced Ted Briscoe had resigned as president and chief operating officer. Briscoe, who will join Play Streaming Media as its chief executive, will stay on board through the second quarter to smooth the transition.

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