TSC 21 Index Eases on Retailers' Weakness

TheStreet.com 21 Index declined Wednesday, giving back gains that accrued before a Dutch newspaper story about component Cisco(CSCO Quote - Cramer on CSCO - Stock Picks) proved false.

TSC 21, a newly created index designed to be a leading indicator of the economy's direction for the rest of the year and beyond, eased 8.06 points, or 0.8%, to 1022. The move compared with a 0.6% slide in the S&P 500 to 1002.22.

The TSC 21 and the broader market got a boost early in the session after a Dutch newspaper quoted Cisco Chief Executive John Chambers saying information technology spending would pick up in the next two to four months. That was enough to get the tech bulls running. Around midday, however, a Cisco spokeswoman said the Dutch paper, Het Financieele Dagblad, had lost something in the translation. Chambers was merely reiterating his long-held stance that industrywide spending will start rising about two to four months after IT customers begin to see their own businesses turning up, whenever that is.

After hitting a new 52-week high of $19.55 this morning, the networking giant's shares settled up 7 cents at $18.80.

While early news on one tech company got sorted out, the market waited for news on another big tech component of the TSC 21, Yahoo!(YHOO Quote - Cramer on YHOO - Stock Picks). During the regular session, investors bid the Internet media company's shares modestly higher, up 0.5% to $35.29. After the close, the company posted earnings of 8 cents a share, in line with expectations, and raised its 2003 revenue outlook. Yahoo! shares slipped 6.1% to $33.15 in after-hours trading, according to Instinet, ahead of the company's conference call. (Wednesday's decline in the TSC 21 doesn't reflect after-hours action.)

Among the other TSC 21 components, the biggest gainer was tech-outsourcer Solectron(SLR Quote - Cramer on SLR - Stock Picks), whose shares climbed 9.9% to $4.77. A host of sub-$10 chip-related stocks climbed today, in part on the Merrill Lynch upgrade of Asyst Technologies(ASYT Quote - Cramer on ASYT - Stock Picks). Solectron rival (and non-TSC 21 component) Sanmina-SCI(SANM Quote - Cramer on SANM - Stock Picks) rose 5.35% today.

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