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Oil Sector a Bright Spot as Major Indices Fall

03/17/99 - 04:24 PM EST

Brian Louis

Stocks slumped overall, but certain sectors of the market posted solid gains, notably oil and oil service stocks, which rallied as crude oil prices surged.

Major Indices
INDEX	CHANGE	%	VALUE
Dow	51.06	-0.5%	9879.41
S&P 500	8.56	-0.7%	1297.82
Nasdaq	10.28	-0.4%	2428.99
Russell 2000	0.75	-0.2%	398.42
TSC Internet	4.28	+0.7%	608.93
TSC E-Commerce	0.18	+0.2%	109.71
TREASURY BOND	CHANGE	VALUE	YIELD
30-Year	16/32	96 8/32	5.507%

The Dow Jones Industrial Average gave up 51.06, or 0.5%, to 9879.41. The S&P 500 slipped 8.56, or 0.7%, to 1297.82. The Nasdaq Composite Index fell 10.28, or 0.4%, to 2428.99. The Russell 2000, meanwhile, dropped 0.75, or 0.2%, to 398.42.

The Philadelphia Stock Exchange Oil Service Index jumped 8% and the American Stock Exchange Oil & Gas Index rose 2% as the April crude oil futures contract gained sharply.

TheStreet.com Internet Sector gained 4.28, or 0.7%, to 608.93.

Inktomi (INKT Quote) will enter TheStreet.com Internet Sector index after the close of trading today, the Philadelphia Stock Exchange said. Inktomi is replacing Netscape (NSCP Quote), whose acquisition by America Online (AOL Quote) was completed today. TheStreet.com E-Commerce Index added 0.18, or 0.2%, to 109.71.

Beyond.com (BYND Quote) will enter TheStreet.com E-Commerce Index after today's close, the American Stock Exchange said. Beyond.com is replacing N2K (NTKI Quote), whose merger with fellow E-Commerce Index component CDnow (CDNW Quote) is expected to be completed today. The merged CDnow/N2K will remain in the index under its new symbol, CDNWD.

The 30-year Treasury bond was down 16/32 to 96 8/32, yielding 5.507%.

On the New York Stock Exchange decliners beat advancers 2,091 to 1,359 on 753 million shares. On the Nasdaq Stock Market, losers beat winners 2,148 to 1,739 on 853 million shares.

On the NYSE, 78 issues set new 52-week lows while 38 touched new highs. On the Nasdaq, 95 issues set new lows while new highs totaled 55.

Most active on the Big Board was America Online (AOL Quote), with 23.1 million shares changing hands. It was up 3 13/16 to 108 3/4.

On the Nasdaq, Dell (DELL Quote) was most active, with 23.1 million shares changing hands. It was down 1 1/2 to 42 15/16.

Market data above are preliminary. Updated numbers and analysis will follow in the Market Roundup

2:53 p.m.: Stocks Cut Losses in Thin Trading

The market's major barometers were slightly lower heading into the final hour of trading.

The Dow Jones Industrial Average was down 12, or 1%, to 9918. The S&P 500 was down 4 to 1302. The Nasdaq Composite Index was down 1 to 2438. The Russell 2000 was down 1 to 398.

TheStreet.com Internet Sector index was up 7 to 612.

Meanwhile, TheStreet.com E-Commerce Index was up 1 to 111.

The 30-year bond was down 13/32 to 96 11/32, yielding 5.50%.

Ricky Harrington, senior vice president and technical analyst at Interstate/Johnson Lane, pointed out that the Dow has leapt about 800 points in about 10 days through yesterday.

Meanwhile, on Friday, index options, equity options and index futures options expire, and ahead of that the market could experience some volatility, although it has been relatively quiet today, market participants said.

Harrington said overall in recent years during expiration weeks the market has made gains. So far, today's weakness has been very subdued and nothing out of the ordinary, he said.

Harrington said the Dow's best chance to close above 10,000 is Friday.

However, if tomorrow's Consumer Price Index report is bad, that would detour the chances of a close above 10,000.

On the New York Stock Exchange, decliners were beating advancers 2,099 to 1,615 on 566 million shares. On the Nasdaq, losers were beating winners 2,091 to 1,671 on 657 million shares.

On the NYSE, 73 issues had set new 52-week lows while 42 had touched new highs. On the Nasdaq, 81 stocks had set new lows while 44 touched new highs.

Most active on the Big Board was America Online (AOL Quote), with 15 million shares changing hands. It was up 2 15/16 to 107 13/16.

On the Nasdaq, Dell (DELL Quote) was most active, with 18 million shares changing hands. It was down 1 1/4 to 43 1/4.

1:59 p.m.: Stocks Remain Stuck in Negative Territory

The major market averages were mired in negative territory this afternoon, but certain sectors of the market bucked the downturn.

The Dow Jones Industrial Average was down 24 to 9907. The S&P 500 was down 7 to 1299. The Nasdaq Composite Index was down 7 to 2432. The Russell 2000 was down 1 to 398.

TheStreet.com Internet Sector index was up 5 to 610.

Meanwhile, TheStreet.com E-Commerce Index was up fractionally at 110.

In other index-reconfiguration news, Beyond.com (BYND Quote) will enter TheStreet.com E-Commerce Index after today's close, the American Stock Exchange said. Beyond.com is replacing N2K (NTKI Quote), whose merger with fellow E-Commerce Index component CDnow (CDNW Quote) is expected to be completed today. The merged CDnow/N2K will remain in the index under its new symbol, CDNWD.

The 30-year Treasury bond was down 13/32 to 96 11/32, yielding 5.50%.

Meanwhile, this afternoon, AT&T (T Quote) declared a 3-for-2 stock split. AT&T was up 1 7/8 to 83 13/16.

In Techland, semiconductor stocks were stronger. The Philadelphia Stock Exchange Semiconductor Index was up 1%.

On the New York Stock Exchange, decliners were beating advancers 1,675 to 1,166 on 488 million shares. On the Nasdaq Stock Market, losers were beating winners 2,099 to 1,615 on 566 million shares.

On the NYSE, 59 issues had set new 52-week lows while 35 had touched new highs. On the Nasdaq, 73 issues had set new lows while new highs totaled 42.

Most active on the Big Board was Compaq (AOL Quote), with 12 million shares changing hands. It was up 9/16 to 32 15/16.

On the Nasdaq, Dell (DELL Quote) was most active, with 17 million shares changing hands. It was down 1 1/16, or 2%, to 43 3/8.

Focus: Oil & Oil Service Stocks

Oil and oil service stocks enjoyed solid gains as the April crude oil futures contract surged to $15 a barrel, up 3.7%.

The Philadelphia Stock Exchange Oil Service Index was up 5.1%. Since March 1, the oil service index has risen about 31%.

The American Stock Exchange Oil & Gas Index, meanwhile, was up a more modest 1.7%. Since March 2, the index has surged 15%.

12:57 p.m.: Midday Musings: Dow Abhors a News Vacuum, and Sinks

12:06 p.m.: Stocks Remain Mired in Negative Territory

Stocks were modestly lower late this morning as red was the dominant color for stock quotes.

The Dow Jones Industrial Average was down 44 to 9887. The S&P 500 was down 11 to 1295. The Nasdaq Composite Index was down 13 to 2427.

The small-cap Russell 2000 was down 2 to 397.

The 30-year Treasury bond was down 11/32 to 96 13/32, yielding 5.50%. (For more, please see the Bond Focus report from late this morning).

TheStreet.com Internet Sector index was up 3 to 608.

TheStreet.com E-Commerce Index was down 1 to 109.

On the New York Stock Exchange, decliners were beating advancers 1,657 to 1,022 on 325 million shares. On the Nasdaq Stock Market, losers were beating winners 1,978 to 1,401 on 392 million shares.

On the NYSE, 46 issues had set new 52-week lows while 33 had touched new highs. On the Nasdaq, 49 issues had set new lows while new highs totaled 37.

On the Big Board, Compaq (CPQ Quote) was most active, with 10 million shares changing hands. It was up 7/8 to 33 1/4.

On the Nasdaq, Dell (DELL Quote) was most active with 14 million shares changing hands. It was down 1 1/8 to 43 5/16.

Tech Focus

The major tech gauges were mixed. The Nasdaq 100 and the Morgan Stanley High-Tech 35 were both down fractionally, while the Philadelphia Stock Exchange Computer Box Maker Index and the Philadelphia Stock Exchange Semiconductor Index were both up fractionally.

Chip titan Intel (INTC Quote) was up 13/16 to 121 3/16. Today the Federal Trade Commission approved an antitrust settlement with the company. The FTC had issued a complaint in June alleging that Intel illegally used its market power when it denied three of its customers -- Digital Equipment, Intergraph (INGR Quote) and Compaq -- continuing access to advance technical information and product samples necessary to develop computer systems based on Intel microprocessors. The complaint alleged that Intel withheld information from the companies as a method of coercing them into licensing their patented innovations to Intel. The settlement is now subject to public comment.

Meanwhile, RealNetworks (RNWK Quote) was a big winner, up 12 1/8, or 11%, to 126 1/2. The stock rose on a report in The Wall Street Journal which said that Microsoft (MSFT Quote) was renewing a collaboration with RealNetworks, a Mister Softee rival.

11:02 a.m.: Dow Joins Its Brethren in Negative Territory

Stocks were modestly lower at midmorning, as oil and oil service stocks were among the few bright spots in the market.

The Dow Jones Industrial Average was down 39 to 9892. United Technologies (UTX Quote) and Caterpillar (CAT Quote) were the biggest gainers in the average, up 1 3/8 to 131 and 2 9/16 to 46 9/16, respectively. United Technologies is selling its automotive unit UT Automotive for $2.3 billion to Lear (LEA Quote).

"I think it doesn't look like it's ready to sustain a move above 10,000," said Louis Todd, head of equities trading at J.C. Bradford. He said he sees the market backing and filling over the next few days.

Todd said it looks like it's going to be a good month in terms of money inflows into the market, a plus for the market.

The Philadelphia Stock Exchange Oil Service Index was up 3%, while the American Stock Exchange Oil & Gas Index was up 2%.

The S&P 500 down 10 to 1297. The Nasdaq Composite Index was down 18 to 2421. The small-cap Russell 2000 was down 2 to 398.

TheStreet.com Internet Sector index was up fractionally at 605.

Meanwhile, TheStreet.com E-Commerce Index was down 1 to 109.

The 30-year Treasury bond was down 5/32 to 96 20/32, yielding 5.48%.

On the New York Stock Exchange, decliners were beating advancers 1,492 to 995 on 216 million shares. On the Nasdaq Stock Market, losers were beating winners 1,756 to 1,317 on 266 million shares.

On the NYSE, 32 issues had set new 52-week highs while 30 had touched new lows. On the Nasdaq, 38 issues had set new lows while new highs totaled 32.

On the Big Board, Compaq (CPQ Quote) was most active, with 7 million shares changing hands. It was up 13/16 to 33 1/16.

On the Nasdaq, Dell (DELL Quote) was most active with 11 million shares changing hands. It was down 1 3/16 to 43 3/16.

Company Focus: Eli Lilly

Prozac's dark quarter continues to depress Eli Lilly (LLY Quote) investors. SG Cowen drug analyst Steve Scala said this morning that his $2.32-a-share earnings estimate on Lilly for the year might be 2 cents high.

Lilly was down 4 3/16 to 89 7/8.

Prozac sales are being hurt by Celexa, the new anti-depressant from Forest (FRX Quote) and Warner-Lambert (WLA Quote). Also, there is less demand this quarter because there was heavy stocking of Prozac by wholesalers in the fourth quarter. Merrill Lynch analyst Steve Tighe made the same call last week, which put pressure on the stock. He says that in the first quarter, Prozac is likely to be flat from last year's first-quarter sales of $617.6 million.

--Jesse Eisinger