Pulse: Ariba, B2Bs Nudge Tech Sector Into Green
Ariba (ARBA) ended almost 8% higher today after U.S. Bancorp Piper Jaffray initated coverage on the B2B company at a buy rating, in turn helping the TheStreet.com Internet Sector, or DOT, rise for the day. With Ariba set to announce results on Wednesday, investors are counting on good news from the company and the sector in general. The DOT ended 1.4% higher.
Other B2B names had a good day.
PurchasePro
(PPRO)
,
Commerce One
(CMRC)
, and
Ventro
(VNTR) - Get Venator Materials PLC Report
were all up, marking the third consecutive session of gains for the sector. The
Merrill Lynch B2B Internet Holders
(BHH)
rose 8% in front of this week's earning reports.
It was refreshing to see investors had unwavering confidence in at least one tech sector. Many expect B2B firms to post strong quarterly results. Not only was the sector unaffected by the slowing economy, but it may likely benefit from the misfortunes of others. Slowing growth means lower revenues and will force many companies to slash operating costs. Those struggling companies are likely to turn to B2B technology to streamline the procurement process.
E-marketplace host PurchasePro.com ended up 26% after splitting 2-for-1 before the market opened. Analysts expect the company to beat third-quarter estimates when they report Wednesday.
TheStreet Recommends
Ventro ended the day 15% higher, despite being downgraded by
Sand Brothers
to neutral from buy. It hit a 52-week-low of $5 on Friday, but settled at $6 in a midsession recovery that bled into Monday.
Amazon
(AMZN) - Get Amazon.com Inc. Report
was one of the DOT's biggest losers, dropping 14% on no news.
Yahoo!
(YHOO)
also continued its protracted decline as it ended 8% lower, just below Friday's closing price but above the 52-week low of $54.75. Online auctioneer
eBay
had a nice day, up almost 7%.
1:34 p.m.: Solly Note Bashes Intel; Intel Drop Bashes Nasdaq Comp
Intel
(INTC) - Get Intel Corporation Report
was heavy in both trading volume and pressure this morning as the chipmaker's gravity pulled down the tech-laden
Nasdaq, which had dipped into the red by midsession.
Intel was lately trading 10.7% lower, after crumbling last month when it warned that third-quarter sales would miss its targets. Today from
Salomon Smith Barney
analyst Jonathan Joseph said that demand will be even weaker than anticipated. Joseph told investors in a report that Intel was facing weaker demand while it was adding capacity.
"The much-hoped-for mid-October pickup in personal-computer demand has failed to materialize, which suggests to us Intel's guidance on its Tuesday afternoon conference call will be more cautious than most investors anticipate," Joseph wrote.
This assessment came on the heel of Friday's
retracement, when Intel regained the trust of investors, who saw demand picking up again in the red-hot chip market.
While traders almost never fail to snap up big-cap tech bargains after a fall from grace, pre-earnings insecurity also sends them scurrying on any hint of bad news. Intel is due to report earnings Tuesday after the close, with profits pegged at 38 cents a share according to analyst consensus.
Joseph cut his earnings estimate to 37 cents but maintained his market outperform rating. Last month Intel blamed weaker demand in Europe for slowing sales, but Joseph added that U.S. corporate PC sales were also lower than forecast.
Last month, Intel's sickness spread like the chicken flu. Today the damage was more selective. Intel's two biggest competitors were down, with
Applied Micro Devices
(AMD) - Get Advanced Micro Devices Inc. Report
off 8% while
Texas Instruments
(TXN) - Get Texas Instruments Incorporated Report
dropped 0.3%, but tech indices away from the chip group were faring better.
TheStreet.com Internet Sector
index was up 0.6%.
The
Philadelphia Stock Exchange Index Semiconductor Index
, however, was 4.4% lower, and the
Philadelphia Stock Exchange Computer Box Maker Index
was down 0.3%.
