Little News, but Tech Sector Still Climbing

As earnings reports slow to a trickle, AOL and homestore.com form an alliance.
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The recovery in the technology sector late last week has made traders more comfortable getting back into tech at the start of this week.

The

Nasdaq

was up 116.07, or 3.01%, at 3976.73 early on.

TheStreet.com Internet Sector

index was up 34.44, or 3.85, at 929.55. The Nasdaq was benefiting from some technical support after it closed above 3793 on Friday. That was the high close of the week and technicians look to that type of level to show that progress is being made. Bob Dickey, director of technical research with

Dain Rauscher Wessels

, hadn't been confident that the Nasdaq would close above 3793 last week, but said if it did, he could see it trading to around 4200, or halfway between its recent high of around 5100 and its recent low of 3300.

With earnings season mostly out of the way, the Internet sector was left with only a trickle of news Monday morning. One stock that was moving on some news was

homestore.com

(HOMS)

, which picked a great time to announce an

alliance with

America Online

(AOL)

. Homestore.com was up 4 1/16, or 22%, at 22 5/16. AOL was down 5/16, or 0.5%, at 59 11/16.

The online companies entered into a five-year deal to market Homestore.com's real estate and home services on its Web sites. Under the terms of the deal, AOL will receive 3.9 million shares of Homestore.com and $20 million in cash. AOL will establish a new home-related channel on its site that will offer users access to apartment and new home listings as well as information for moving, remodeling and furnishing.

Inktomi

(INKT)

was up 9 7/8, or 6%, at 163 13/16.

Bear Stearns

analyst Robert Fagin released a note announcing that Inktomi would be holding an investor day on Thursday, which he said could be a catalyst for the stock. Bear Stearns has not done underwriting for Inktomi.

"While the focus of the day will be the opportunity for investors to interact with Inktomi's management team, we suspect the day could serve as a strong trading catalyst as management provides additional depth regarding new initiatives," the note said. "We believe management will use the forum to make several announcements across product lines."

Fagin also wrote that Inktomi's new parternership with

Vignette

(VIGN)

-- to integrate Vignette's V/Series eBusiness Platform with Inktomi's traffic server and content delivery suite -- was "a testament to Inktomi's industry leadership."

"Potential catalysts for Inktomi over the next several quarters include higher than expected Commerce Engine revenues (we have modeled only $26 million in revenues for FY01); potentially stronger than expected sales of Network Products, especially to CDNs/SMNs and corporate enterprises; stronger than expected sales of caching appliances built on Inktomi's Traffic Server (such as Intel's new NetStructure 1500 cache appliance); a strong reception for the company's wireless initiatives; and the introduction of new B2B and digital goods initiatives," Fagin wrote.

There are some earnings reports that are still to come. Among the companies that have quarterly reports Monday,

Register.com

(RCOM)

was up 9 5/16, or 18%, at 60 5/16. Note that the stock has roughly doubled in price since closing at 27 1/2 just last Wednesday. Also,

barnesandnoble.com

(BNBN)

was down 3/16, or 2%, at 10 3/4; and

Expedia

(EXPE) - Get Report

was up 1 3/16, or 8%, at 16 1/4.