Techs Undone By Jobs Report

It took a dismal jobs report to give the Nasdaq its first losing day of 2004, and even then the bulls almost pulled it out.

The Nasdaq recovered from an opening dip to spend much of the day in positive territory despite news from the U.S. Labor Department that fourth-quarter jobs growth was far less than expected. But in the afternoon, techs finally succumbed, following the Dow into negative territory.

And for good reason. Business investment may finally be on the upswing, but consumer spending remains two-thirds of the economy. Without significant job growth, it’s just a matter of time until consumers pull in their horns.

The Nasdaq lost 13 to 2086, the S&P 500 fell 10 to 1121, and the Dow plunged 133 to 10,458. Volume declined to 1.67 billion shares on the NYSE, and 2.49 billion on the Nasdaq. Decliners led by a few issues on the NYSE, and by a 19-12 margin on the Nasdaq. Downside volume was 63% on the NYSE, and 49% on the Nasdaq. New highs-new lows were 466-6 on the NYSE, and 348-7 on the Nasdaq.

IBM fell 2% after revealing that it is under investigation by the SEC for a deal with Dollar General.

Cisco managed a small gain on an upgrade. Fulcrum recommended that a buy of Cisco shares be paired with a sale of 3Com , which fell 6%.

Open Text surged 11% after raising guidance.

Lucent fell 5% on a valuation downgrade by Morgan Stanley.

Red Envelope plunged 29% on a warning.

Rambus gained 4% on a favorable court ruling.

UTStarcom fell 10% on a large secondary offering.

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