So much for the Bush bounce.
Nearly every Wall Street watcher expected a “relief rally” once the confusion and uncertainty regarding the presidential election was cleared up.
That moment came Tuesday night, when the Supreme Court handed down a decision on Florida vote recounts that essentially handed the White House to Texas Gov. George Bush. By Wednesday morning, aides to Vice President Al Gore were saying that the Democratic nominee would throw in the towel in a televised speech on Wednesday night.
Investors must have missed the news, because stocks did anything but soar in the first trading session following the high court ruling. The Nasdaq finished down 3.72%, while the Dow gained a modest 0.24%.
‘Net stocks fared worst of all, with internet.com’s Internet Stock Index, or ISDEX, falling 5.25%.
So what happened to that rally, now that we’ve averted a national crisis? My feeling is that the market had slipped out of crisis mode by Thanksgiving because, as the legal fight in Florida dragged on interminably, it became clear that our nation wasn’t hurtling toward anarchy. Just more of the usual political squabbling until the issue was resolved by a court, followed by four more years of the usual political squabbling.
Well, it takes a little more than Beltway bickering to keep investors awake at night. It takes a steady stream of bad earnings reports, growing signs of an economic slowdown and dwindling dot.com dreams.
Double Dose of DoubleClick
On Wednesday I noted DoubleClick’s
surprising 16% surge on Tuesday after the online ad-services market leader issued a Q4 revenue and earnings warning, offering a couple of theories to possibly explain the market’s positive reaction to bad news.
Now I think I’ve identified the catalyst for DCLK’s big share hike: In a conference call to discuss its financial situation, DoubleClick executives assured analysts that, despite rumors to the contrary, the company owns no stock in other Internet companies. Clearly, good news travels fast in investor circles.