Yup, you guessed it: More bad news about the earnings outlook was giving the stock market hell today. In what has become another nasty day on Wall Street, the Dow Jones Industrial Average 
was down close to 200 points, although off its lowest levels of the session, while the Nasdaq Composite Index was hovering just the 1700 mark.
On the heels of the lowest close on the Nasdaq since Oct. 30, 1998, the tech-heavy index was straddling another key support level this afternoon. A day after the end of the first quarter, a late batch of confessions about the quarter that just ended hit the marketplace. Perhaps the companies that are warning just now had been hoping that end-of-the-quarter sales would allow them to match more optimistic estimates. Boy, were they dreaming.
| Major Indices | | INDEX | CHANGE | % | VALUE | | Dow |   193.35 | -1.98% | 9,584.58 | | S&P 500 | 26.84 | -2.34% | 1119.03 | | Nasdaq | 79.99 | -4.49% | 1702.98 | | Russell 2000 | 12.12 | -2.76% | 427.64 | |
TSC Internet | 26.58 | -12.61% | 184.22 | | NOTE | CHANGE | PRICE | YIELD | | 10-Year Treasury |  5/32 | 100 10/32 | 4.961% | | Market data as of: 12:36 PM ET, Apr 3 2001 | |
Profit warnings came yesterday evening from B2B play
Ariba(ARBA Quote - Cramer on ARBA - Stock Picks), down 23.1% to $5, networker
Redback Networks(RBAK Quote - Cramer on RBAK - Stock Picks), off 11.5% to $10.35, Internet infrastructure software developer
Inktomi(INKT Quote - Cramer on INKT - Stock Picks), behind a whopping 52.4% to $2.94 and e-services firm
E.piphany(EPNY Quote - Cramer on EPNY - Stock Picks), lower by 18% to $8.
Market internals were atrocious. Recently, decliners were leading advancers on New York Stock Exchange
by more than 3-to-one, while losers outnumbered winners on the Nasdaq by more than 4-to-1. Trading volume was light, as apparently, many investors are thinking twice about playing the market. "At this point, it's difficult for researchers and salesman to pound on the table," said Ned Collins, executive vice-president of U.S. stocks at
Daiwa Securities America. "It's tough to tell people they've got to own stocks now."
If this latest round of earnings news is any indication about the future, there are probably lots more companies with last-minute disappointments up their sleeves. Until the earnings picture brightens, the stock market outlook will likely darken.
Not until the first quarter of 2002, Collins said, are earnings likely to turn around. But since the stock market is a six-month leading indicator, he predicts that stocks could see a comeback in June. Before that time, he thinks the Dow could go as low as 8500. "Markets don't announce tops and bottoms, but it feels like there's more room on the way down," he said.
Salomon Smith Barney this morning lowered its year-end outlook for the Dow to 11,400 from 11,750.
Also weighing on today's market is tension overseas. Today marks day three of the standoff between China and the U.S. over an American spy plane held in China. Chinese president Jiang Zemin is asking for the U.S. to accept full responsibility for the collision between a Chinese fighter plane and the U.S. plane and to halt surveillance missions near China's coasts.
For some good news, electronics retailer
Best Buy(BBY Quote - Cramer on BBY - Stock Picks) was soaring 9.5% to $40.30 after it beat first quarter targets by 7 cents per share. It announced earnings of 89 cents per share. And drug stocks were moving higher.
Back to top | Market Internals |
| Exchange | Advancers | Decliners | New Highs | New Lows | Volume |
| New York Stock Exchange | 751 | 2,186 | 26 | 124 | 634 million |
| Nasdaq Stock Market | 677 | 2,843 | 10 | 462 | 1.3 billion |
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Overseas markets were tattered and in rags. The major European indices posted three-digit losses. Continuing weakness in banks and trouble for drug stocks hit London's
FTSE 100, which closed down 155.4, or 3%, to 5463. Across the channel, the Paris
CAC 40 was off 207, or 4%, to 5004. Frankfurt's
Xetra Dax -- which is still trading -- was shedding 220, or 3.8%, to 5540.
The euro was lately trading at $0.8845.
Tokyo snapped back after three days of major losses, though Hong Kong didn't follow it higher. Japan's
Nikkei 225 rose 1.4%, or 186.6, to 13124.5 overnight as investors snatched up banks, real estate and other shares in anticipation of announcements of an emergency economic package on Wednesday. Hong Kong's
Hang Seng slipped another 143.1 points, or 1.1%, to 12,584.2.
The dollar was trading at 125.87 yen.
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Diane Hess
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