Stocks began a new quarter on a mixed note Monday, as blue chips rose but Internet and technology shares slipped.
lost 6 to 746, and the Nasdaq declined 18 to 3654. The S&P 500 added 5 to 1441, and the Dow rose 55 to 10,706. Volume declined to 410 million shares on the NYSE and 750 million on the Nasdaq. Decliners led by 14 to 12 on the NYSE and 20 to 15 on the Nasdaq. The National Association of Purchasing Management survey showed economic contraction for the second month in a row. The big economic report for the week is Friday’s unemployment report. For earnings reports, visit our earnings calendar and reported earnings. For after hours quotes and news, visit our new after hours trading site.
lost 11 1/16 to 176 on a double whammy: the company’s head of technology sales is leaving to join a private B2B exchange. And the trading exchange formed by i2, Ariba
, off 10 1/4 to 133, and IBM
lost The Global Health Care Exchange as a customer. Commerce One
added 11/16 to 79 3/16, and PurchasePro
rose 3/8 to 88 1/4 on an alliance with Gateway
, off 4 3/16 to 21 1/2, and E.piphany
, off 6 3/4 to 70 5/16, fell on Robinson Humphrey downgrades on sales concerns. Also, the firm said BroadVision miscalculated the market shift to Java-based technology.
Bellwether Cisco Systems
gained 2 7/16 to 57 11/16 on positive comments from Morgan Stanley. The company’s order backlog has increased more than 300% to $3.8 billion.
continued to struggle under the weight of earnings concerns, losing 4 15/16 to 86 1/16. The company reports next Tuesday (Oct. 10).
climbed 9/16 to 5 7/16 on the launch of a co-branded portal with MSN.
dropped 1 to 14 1/4 on a Banc of America downgrade from Buy to Market Perform.
fell 1 1/8 to 2 3/8 after warning of lower-than-expected results due to DSL deployment delays and slower-than-expected roll-outs.
added 1 to 54 3/4 on optimism from Lehman Brothers that the company’s merger with Time Warner will be improved.
Some technical comments on the market: Note: We will now be including charts with the technical market commentary; just click on the links in the story below to go to them. If you have trouble accessing the charts via the e-mail newsletter version, try this link: http://www.afterhourstrading.com/column.html
The Nasdaq is about as low as it can go without breaking critical support, its October 1998 trendline. If the index goes below 3500, it likely will retest the May lows of 3042, although it’s possible it could form a new October 1998 trendline at about 3400, on a line with the October 1998 low and the May low. To the upside, a move above its downtrend line at about 3750 could give the Nasdaq room to run. Above that is 3859, the 38% retracement level of the 4259-3614 decline. The ISDEX is back below 750 support. The index’s critical support, its May uptrend line, is now at about 735, so Internet stocks do not have much downside room here either. First resistance is now the 750-760 range, and then the 787-800 range. Above that, two recent rallies have peaked around the 50% retracement level at 850.
The Dow’s downtrend line is at about 10,825; above that line, and the old economy stocks have room to run. To the downside, critical support is the October 1998 trendline at about 10,600 (also in the chart, note the gray lines, the bearish diamond pattern that could signal a market top). The S&P 500 continues to be bound by its April trendline at about 1425 to the downside and its broken May trendline (the gray line) at about 1465 to the upside.
The one sign of a potential bottom here, the inverse head-and-shoulders pattern forming in the 60-minute chart on the S&P 100 (OEX), is still developing. However, the index can’t trade much lower than 760 to preserve the pattern, and the bottom should not be considered formed until the index breaks above the pattern in the 772-775 range.