eBay (EBAY) - Get Report expanded its reach today when it officially launched its local auctions in 10 cities. But the only reach that was of much concern to investors was the one eBay was having on the rest of the sector.
eBay was recently down 13 5/16, or 9%, at 138 11/16, sparking a selloff in the Net sector.
TheStreet.com Internet Sector
index was recently down 19.49, or 2.7%, at 703.66.
eBay's losses come after its third-quarter earnings report showed some areas of
concern. And while the earnings numbers may have disappointed some, taking a step back and looking at things more objectively, eBay stock is really just giving back some of what it gained ahead of its earnings report. The pattern in many Internet stocks is for a pre-earnings run-up, then profit-taking regardless of the numbers. In just one week, eBay went from a high of 155 3/8 to a low of 124 1/2 on Oct. 18 ahead of its earnings Tuesday.
eBay's woes have persisted despite an appearance by CEO Meg Whitman on
this morning. Whitman appeared on
around 8:20 EDT when eBay was trading near 139, but the stock has actually moved lower since the interview. And while Whitman said she was comfortable with earnings estimates for the fourth quarter, she also said she does not expect to see a big earnings spike in the quarter, and that eBay's biggest quarter in the past has been the first. Incidentally, with the launch of its San Francisco Web site, users can bid on a chance to bowl with Whitman or one of Mayor
The losses in eBay have been a drag on the rest of the sector, and may have sparked some concerns about slowing growth in other Net companies. A number of other stocks that have rallied ahead of their reports this week also were feeling the pinch as traders elected to get out now rather than wait until they saw the numbers.
, which is scheduled to report after the close, was off 4 7/16, or 5.5%, at 76 13/16. It is expected to report a loss of 28 cents a share, according to
First Call/Thomson Financial
, which is scheduled to report Thursday, was down 5 1/16, or 6.5%, at 72 7/8.
, which also is scheduled to go Thursday, was down 1 7/16, or 2.1%, at 66 5/16. And
, which is also expected to report Thursday, was down 4 15/16, or 7.9%, at 57 7/16.
has also been a post-earnings disaster. The stock dropped sharply after
downgraded it on Friday following its earnings report last week. And today the stock was down another 7 1/16, or 7%, at 95 11/16, apparently ahead of the public debut of
, a company that is expected to challenge Inktomi.
Akamai is expected to be priced on Thursday and begin trading on Friday and should be the biggest IPO of the week. Both
have stakes in the company, which has developed technology to deliver bandwidth-heavy content to end users at high speeds.
tipped off readers to the company and the threat it provides to Inktomi back in September.
The biggest success story of the day was undoubtedly
, which provides Internet management solutions. The company reported a profit of 11 cents a share for its fiscal fourth quarter on Tuesday, which was far above expectations of a 5-cent loss, according to First Call/Thomson Financial. It was up 37, or 37%, at 136 1/8.