Skip to main content

DOT Recovers From Midmorning Selloff to Hit Record Close

Net stocks also benefit from a report by a top Internet analyst.

With Y2K concerns behind it and with nothing but bullish news to drive it, the Internet sector began 2000 much the same way it performed toward the end of 1999 -- on a major roll. Internet Sector

index finished the day up 63.89, or 5.5%, at 1218.35, another record-high close. The DOT traded as low as 1138.43 after a midmorning selloff, but that was quickly seen as a buying opportunity and it closed near the session high of 1218.47.

"If anything has been learned, it's that you make the most money buying pullbacks. It's as simple as that," said Dick Dickson, technical analyst at

Scott & Stringfellow


Gains in the tech sector also aided the

Nasdaq Composite Index

, which finished up around 62 points after a late-afternoon rally.

Dickson said if the Nasdaq does falter in the coming sessions, it could drag down the Net sector, but otherwise the Net sector remained in an uptrend. He said based on a pattern of the DOT continuing to make higher lows (a positive signal), he projects gains in the index to the 1283 level. When the DOT broke the 1000 level back in early December, Dickson at that time projected it could go to the 1337 level.

There were a number of positive fundamental developments as well.

(AMZN) - Get, Inc. Report

closed up 13 1/4, or 17%, to 89 3/8 on a report from

Media Metrix

that Amazon was the top e-commerce site for the holiday shopping season, with an average of a little less than 5.7 million visitors on the site per week from Nov. 22 to Dec. 26.

TheStreet Recommends


(EBAY) - Get eBay Inc. Report

, which was the second-most-visited site with an average of 4.1 million visitors per week, closed up 16 1/6, or 13%, to 141 1/4.

But even bigger movements were seen in 10 stocks that were mentioned by Steve Harmon, an influential Internet analyst who runs

, as his top picks for 2000. One of the stocks,



, traded in a range between 284 and 312 3/4, closing up 49 9/16, or 18%, at 326 7/16. Harmon also chose

Net Perceptions



Pacific Internet




(SPYG) - Get SPDR Portfolio S&P 500 Growth ETF Report



(CNET) - Get ZW Data Action Technologies Inc Report


U.S. Interactive



Terra Networks



Redback Networks



America Online



Santa Cruz Operation


as his top picks for 2000, message boards indicated.

The news lifted all the stocks, with both CMGI and U.S. Interactive soaring on the news. CMGI closed up 49 9/16, or 18%, at 326 7/16, while U.S. Interactive soared an incredible 33 1/2, or 78%, to 76 1/2. Also, Harmon reportedly had already mentioned that Santa Cruz Operation was on the list, so it had less of a gain than the others. It finished up 7/8, or 3%, at 31 1/4, though it did trade as high as 35 1/16. (Note that on his Web site, Harmon lists both CNet and AOL as two of his media partners.)

Among the others, Net Perceptions closed up 7, or 19%, at 49 after trading as high as 63 1/2; Pacific Internet closed up 22 15/16, or 49%, at 69 7/8; Spyglass closed up 13 5/32, or 35%, at 51; CNet closed up 4 11/16, or 8%, at 61 7/16; Redback finished up 4 1/2, or 3%, at 182; Terra Networks closed up 5 3/4, or 11%, at 60 1/2; and AOL finished up 16 11/16, or 9%, at 82 9/16.

Positive comments from

First Union Securities

analysts helped lift both






. First Union reiterated a strong buy rating on Yahoo! and increased its price target to 600. It finished up 42 5/16, or 10%, at 475. And the research firm also picked AskJeeves as its top Internet content pick for 2000. It closed up 25 1/16, or 22%, at 138. First Union has not done underwriting for either company.




closed up 14 15/16, or 6%, at 268 after

Morgan Stanley Dean Witter

initiated coverage of the stock with an outperform rating and a 300 price target.