Could it be that the Internet sector had just a normal trading session? And could it also be that Net stocks were mostly lower? The answers are yes, and yes.
Internet stocks were modestly lower, but it was nothing too serious, and nothing to suggest that it was anything but a little
profit-taking. And while the old trading axiom says that for every buyer there is a seller, it did appear that when most stocks dropped sharply there were buyers just waiting in the wings to scoop up some stocks at "bargain prices." There was no follow-through to yesterday's
-inspired rally, in part because the Fed continues to indicate it is on course to raise rates.
There are any number of factors at work. While the sector has had a nice run-up, there doesn't appear to be a compelling reason to sell other than the sector has had a nice run-up. By all indications, the fourth quarter should be a strong one and even a postearnings sell-off would be roughly a month away. And many funds still looking to add some of the hot tech names to their portfolios continue to provide some underpinning. Money that was on the sidelines ahead of the Fed's decision also was being put to work.
At the same time, the sector has had such a nice run-up that buying many Net stocks at current prices is tough. "I just can't see buying right here," said one daytrader, who said he was somewhat concerned the market could be topping. But the daytrader said he also was reluctant to sell right now due to tax concerns. He said if he waited until next year to sell, he could still "play" with the profits next year. It's that type of logic that has some market
watchers looking for a selloff early next year.
For the most part today, many of the stocks that have been among the hottest of the hot remained hot.
, the B2B company that has a 1,000
price target on it, closed up an incredible 70 points, or 14.6%, at 550 after trading as low as 458 1/2.
We'll continue to warn you about the huge lockup in shares of Commerce One that will be
lifted later this month, though
James Cramer pointed out that there are times that lockup expirations simply cause a minor dip because the market can absorb most of the stock that comes free to trade.
On Dec. 28, more than 12 million Commerce One shares will come out of lockup, equal to nearly four times the 3.3 million shares now available for trading. It appears as though there should be good demand for those shares and that Commerce One is in a much different position than
, which has suffered after 109 million shares were
released from lockup.
Internet incubators soared once again.
Internet Capital Group
closed up 8 1/2, or 4.6%, at 192 1/2 after
initiated coverage of the stock with a market outperform rating, which is roughly equivalent to a buy rating from other research houses, but not as good as making the recommended list. The report was mostly positive, but it appeared as if just the mere fact that Goldman was talking about ICG was enough for traders to buy. Practically the same thing happened yesterday when
rallied on a lukewarm
. CMGI finished up 5 1/8, or 1.9%, at 275 3/8 after trading as low as 254.
finished up 4 3/4, or 1.8%, at 272 1/4 on a day when it said it was considering restructuring, while announcing a stock split and a possible secondary offering.
joint newsroom took a closer look at the company's moves in an earlier
closed up 7 7/16, or 9.3%, at 87 1/2 after
upped its price target on the stock to 105.