Microsoft was down 13 1/2, or 12%, to 93 after settlement talks ended with the government in the antitrust case against the software giant. The
was off 201.37, or 4.4%, to 4371.46 giving back Friday's 114.71 point gain.
TheStreet.com Internet Sector
index was down 45.84, or 4.1%, to 1061.23.
TheStreet.com New Tech 30 was down 43.56, or 6%, to 696.83.
Rough Going for Bellwethers and Incubators Alike
will be a focal point in the sector this week ahead of its earnings report after the close on Wednesday. It was down 5 3/4, or 3%, to 165 5/8 early on. Among other traditional Net bellwethers,
was down 2 1/2, or 3.7%, to 64 1/2, while
was flat at 176 after tumbling on Friday.
Also, Internet incubators, whose price action often represents sentiment in the sector, were weaker as well.
was down 10 1/8, or 9%, to 103 3/16 while
Internet Capital Group
was down 7 1/4, or 8%, to 83 1/16.
Back to Business-to-Business
Weakness in business-to-business stocks after
downgraded three B2B plays put pressure on the Net sector early Friday. There was ongoing weakness today among those three stocks.
was down 10 9/16, or 7%, at 138 11/16.
was down 8 13/16, or 8%, at 96 and
was down 15, or 12%, at 107 1/8.
Research analysts offered several responses today on the B2B debacle.
Credit Suisse First Boston
analysts wrote that the controversy surrounding how much long-term pricing power marketplace vendors will have was unfounded, claiming that marketplaces were likely to undergo a profound transformation beyond procurement of nonproduction items of a static catalog. In summary, they wrote that this sector of software vendors "have the potential and the promise to participate in the industries they are so deeply transforming."
analysts noted that industry fundamentals "remained intact and compelling," and reiterated buy ratings on
. Analyst Scott Ehrens emphasized that there were structural differences between models used by companies like Commerce One and those of FreeMarkets and PurchasePro. He wrote that "metamediaries" like FreeMarkets and PurchasePro "that provide liquidity, process and product savings and new incremental revenue opportunities will continue to garner transaction and network fees for the value that they create."
In recent trading, FreeMarkets was down 12 1/8, or 10%, to 108 7/8, while PurchasePro was up 1/2, or 0.69%, to 72 1/2. Bear Stearns has done underwriting for PurchasePro, but not FreeMarkets.