Stocks Recover From Sell-Off

Stocks fell early Wednesday after American Express issued the second profit warning by a Dow component in two days, but the market recovered by the close.

The ISDEX http://www.wsrn.com/apps/ISDEX/ rose 1 to 192, and the Nasdaq gained 9 to 2011. The S&P 500 was up fractionally to 1137, and the Dow climbed 6 to 9894. Volume rose to 1.4 billion shares on the NYSE, but declined to 1.8 billion on the Nasdaq. Decliners led 16 to 15 on the NYSE, but advancers led 18 to 17 on the Nasdaq.

After the close, Yahoo made a surprise bid for HotJobs , Macrovision and Macromedia plunged on warnings, Verity rose after topping estimates, and Applied Materials announced another round of layoffs.

The Producer Price Index and retail sales will be reported tomorrow morning, and the CPI, industrial production and capacity utilization on Friday. The $3 billion Prudential IPO begins trading tomorrow.

Ciena and Adobe report earnings in the morning, and Oracle reports after the close tomorrow. Ciena and Adobe both fell today on negative analyst comments.

Also during the day, Comverse slipped after matching estimates and announcing layoffs, and CMGI fell after missing revenue estimates, warning and restating a previous loss.

The IPO of NetScreen priced at 16 and closed near its opening price of 23.76.

Neoforma soared despite issuing wide earnings guidance.

CheckPoint gained 5% on an expanded alliance with Nokia . RealNetworks climbed on a deal with Compaq .

InVision surged 15% on an FAA contract.

Some technical comments on the market: Note: To see the charts in the text email newsletter, click on the internetstockreport.com story link at the top of the newsletter.

Little new in the commentary for tonight, despite the wild day in the market: Tech stocks are still holding up, but the broader market looks very shaky here. The Dow (first chart) and S&P (second chart) have no uptrends left from the September lows. For the Dow, resistance is just under 10,000 and then at 10,100. Support is at 9800 and then 9700. For the S&P, support is 1125, and resistance is 1142-1143 and 1158. The Nasdaq (third chart) and Nasdaq 100 (fourth chart) both broke their uptrends today, but recovered by the close. Support is at roughly 2008 and 1995 on the Nasdaq. The Nasdaq 100 has support at 1660 and resistance at 1690. This leg down has not been very impressive so far, so another pop higher soon would not come as surprise. There are a lot of earnings and economic reports the next two days, and then Friday begins a very interesting cycle turn window.

Special report: For a free introduction to technical chart patterns and an overview of last year’s action in the stock market, visit http://www.internetstockreport.com/guest/article/0,1785,2571_500051,00.html.