Priceline.com rose Monday on news that famed value investor Prince Alwaleed bin Talal plans to invest $50 million in the company. The broader market was mixed as sellers finally ran out of steam.
The ISDEX gained 2 792, while the Nasdaq slipped 6 to 3971. The S&P 500 gained 5 to 1500, and the Dow rose 19 to 11,240. Volume was unchanged at 430 million shares on the NYSE and 700 million on the Nasdaq. Advancers led 14 to 10 on the NYSE, but decliners led 20 to 16 on the Nasdaq. Oracle and Red Hat report earnings on Thursday. The PPI for August will be reported on Thursday and the CPI on Friday. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our new after hours trading site.
Priceline rose 1 1/2 to 27 1/4 on news of the Saudi prince’s investment, the second high-profile value investor to bet on a fallen Internet stock. The first was Bill Miller of Legg Mason Value Trust, who believes Amazon.com should be valued in the mid-60s. Amazon
gained 1 5/16 to 44 1/4 despite Merrill Lynch analyst Henry Blodget raising his third-quarter loss estimate on the stock from 30 to 32 cents a share. Blodget said long-term, patient investors in Amazon will be rewarded. The stock, which traded as low as 41 on the news, has been holding well around its breakout point in the 42-43 range. That said, as we’ve pointed out previously, a return to the 31-36 level in the next few weeks is possible. Also on a value note, Dallas Fed President Robert McTeer said the stock market is much less of a bubble now than it was earlier this year.
Telecom equipment stocks, the market’s leader for much of this year, continued to struggle on concerns that telecom equipment spending may be slowing. Cisco fell 1 to 62 7/8 and Juniper Networks
was down 3 7/16 to 194 3/16, but Northern Telecom
rose 1 1/2 to 73 1/2.
Commerce One rose 4 5/8 to 76, continuing its run after closing above 70 resistance on Thursday. Prudential upgraded the stock to Strong Buy and set a $90 price target. Ariba
gained 2 3/4 to 156 1/2, i2
rose 5 3/8 to 165 7/8, FreeMarkets
added 4 1/8 to 76 3/4, and PurchasePro
climbed 3 15/16 to 69 5/8.
Check Point Software rose 2 7/16 to 148 11/16 after Merrill Lynch began coverage with a neat-term Accumulate and long-term Buy, calling the company a core software holding.
DoubleClick , up 1 3/16 to 34 7/8, and Covad
, up 1 3/16 to 19 9/16, are holding analyst meetings today, and JDS Uniphase
, up 15/16 to 115 1/4, will hold one tomorrow. Covad rose last week on news that the Verizon strike won’t keep the company from meeting its numbers this quarter.
Liberate gained 1 1/2 to 31 1/2 on news of a European contract win.
internet.com , publisher of this Web site, slipped 1 5/16 to 26 after announcing the acquisition of advertising and marketing information site clickz.com for $16 million in cash and stock.
Radware , up 1 9/16 to 31 7/8, and Akamai
, off 1 9/16 to 65 15/16, announced an Internet content partnership.
SpeechWorks fell 8 5/16 to 64 3/4 after a Barron’s article questioned the company’s valuation.
Allaire , off 2 1/2 to 22 1/2, continued to fall despite positive an
alyst comments.
Some technical comments on the market: The Nasdaq and Nasdaq 100 found support where we hoped they would, at the downtrend lines broken last month (3900 on the Nasdaq, 3750 on the Nasdaq 100). However, the indexes so far haven’t rallied with much strength, so another test of those levels may be in the cards. A break below those levels would likely lead to a wider sell-off. To the upside, the Nasdaq faces resistance at around 4000, and then again at 4100. The Dow and S&P 500 continue to find support at 11,200 and 1490, respectively. The Dow may be forming a head-and-shoulders top here; a clean break of 11,200 would likely carry the index back to 11,000. Critical support is just under 10,900, the upper boundary of the Dow’s bearish diamond pattern, which the index broke out of last month. Resistance on the Dow is 11,300 and 11,400, and on the S&P, 1500 and 1507. First support on the ISDEX is 790-800, which the index undercut today but then recovered. Critical support is just above 700, which is now the intersection of the index’s March downtrend and May uptrend lines. To the upside, the ISDEX’s recent rally was capped by the 50% retracement level of 850.
