Internet Stocks Buoyed by Employment Report

Also, QXL.com's meteoric rise may turn out quixotic and E*Offering names some 'Diamonds in the Rough.'
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A nonthreatening

employment report gave investors another reason to get back on the buy side in tech early today. But if today is anything like most of the other days this week, the first move is not necessarily an indication of where things will end, particularly in advance of the weekend.

TheStreet.com Internet Sector

index was up 35.50, or 3.5%, to 1050.93 in early trading.

TheStreet.com New Tech 30 was up 28.78, or 4.3%, to 705.13. For those of you who thought our own

James Cramer

never slept, he finally found something to make him yawn:

Gene Marcial's

latest

column in

Business Week

.

The eBay of Europe?

Among stocks in the news, yesterday's crazy

story surrounding

QXL.com

(QXLC)

continues to draw attention today. The stock rose 132% yesterday to 51 63/64 after

SG Cowen

slapped a 1000 price target on the stock (333 1/3 after a 3-for-1 split). But the session high was 117 3/8, so it had already given back quite a bit of its move. The logic behind the lofty valuation has been questioned, particularly because the analyst indicated that the stock should be valued similarly to American auctioneer

eBay

(EBAY) - Get Report

. Today, QXL was down 2 63/64, or 5.7%, to 49.

Analysts at

Goldman Sachs

today released a very cautious report on QXL, saying yesterday's price action was "an extreme overreaction."

"While the opportunity exists for QXL to become the eBay of Europe, it is not there yet," wrote analyst Phil Clark. "We believe the fundamental story remains firmly on track, and that long-term holders should sit tight, but some near-term profit-taking is likely."

In addition. Clark pointed out that the lockup period on seed investors expires on April 13-14, and up to 20% of the stock can come into the market. Clark also wrote that he expects the company to have strong news flow ahead of the lockup expiration, including online distribution agreements to support some of the recent geographic expansion of QXL.

Up and Dot-Coming

Yahoo!

(YHOO)

, which dropped 7% yesterday after

reporting earnings Wednesday night, was back on the plus side today, up 3 5/8, or 2.4%, to 157 5/8.

Autobytel.com

(ABTL)

was up 1, or 13%, to 8 5/8 after the online auto seller said it expected first-quarter numbers to be above expectations. The company said it expects revenue for the quarter to be between $14.5 million and $15 million, and the net loss to be in the range of 43 cents to 45 cents per share. The current median analyst estimates are revenue of $13.4 million and per-share net loss of 48 cents. The

First Call/Thomson Financial

estimate for Autobytel is for a 41-cent loss, though an investor relations spokesperson for Autobytel told

TSC

that the First Call estimate only includes two estimates, and there is coverage by five research groups. The 48-cent loss estimate is the median of those five estimates, he said.

Liquid Audio

(LQID)

was up 5 5/8, or 43%, to 18 5/8. The audio software company is teaming with

BMG Entertainment

to sell digital music downloads through online retailers. BMG plans to use Liquid Audio's software to control the flow of content online from the point of creation to retail delivery.

Finally, with the recent setback in the Internet sector, research firms have been preparing

lists of stocks they believe will be success stories when the dust settles. Today,

E*Offering

released its list of "Diamonds in the Rough," which it claims are the best names for near-term appreciation. Stocks include

About.com

(BOUT) - Get Report

,

Commerce One

(CMRC)

,

Digital Island

(ISLD)

,

Onvia.com

(ONVI)

,

Peregrine Systems

(PRGN)

,

priceline.com

(PCLN)

,

XCare.net

(XCAR)

and Yahoo!.