Oh, wouldn't it just be precious if tomorrow -- exactly one month from the
day the almighty
Dow Jones Industrial Average
struck 10,000 -- the increasingly plump blue-chip proxy took ownership of the next millennial mark?
yesterday's economically sensitive cyclical stars continuing to stand on the index's side (save the financials), special Dow fanfare just may hit the networks before the week's close. All this as market watchers continue to point to low interest rates, a healthy domestic economy and a recovering global economy as the main reasons for inexhaustible big-cap moves skyward.
"The things that will continue to move this market are low inflation, low interest rates and improved productivity," said Dick Stein, chief technical analyst at
Noble Financial Group
in Boca Raton, Fla. "The only other thing you could ask for is a reduction in taxes, but I'm not looking for that cherry on top of the whipped cream."
As for whether there is merit to the mounting argument that markets abroad aren't as bleak as they once were, Stein said: "A recovery in the Pacific Rim will initially help the export situation, adding demand for our products. And
Procter & Gamble
will benefit. And it will push oil prices higher, but it could also increase inflation. So in every good, there is some bad."
America's economic superhero,
, spent the morning speaking before a
subcommittee, but his testimony on a financial services modernization bill didn't appear to be having any effect on the markets.
The Dow lately was up 41 to 10,872, off its session high of 10,900.72 but still in record territory. Boosting the average were lower-multiple cyclical names
continued to benefit from yesterday's news of Azerbaijan's agreement to develop oil fields. The
American Stock Exchange Oil & Gas Index
was rising 3.4%.
But financial giants
, which had been rising with the cyclicals, were hit with a bout of profit-taking.
also was returning recent gains.
"IBM started acting like a Net stock," Stein said. "Most of its holders would be happy to see
the stock's recent move in a year. It's very hard to exaggerate the potential of the information-technology group, from voice to computer. It's a very compelling story, and will certainly take us to the next millennium."
The strategist, however, expects seasonal factors to cool off the tech sector following this first-quarter earnings season. "You just wanna see this rotation back into tech not get ahead of itself," he said. "I'd love to see them suffer for a month -- hit that slowing period in May after earnings. Then in June, we'll see the end of the second quarter not look as well as the first quarter. In July through October, we'll start to accumulate again." Stein sticks to his year-end Dow target of 11,250, saying, "My wife has never called me conservative, but the stock market might."
Today also looked like a good day for techs to make sure they don't get ahead of themselves. Following a short excursion into positive airspace, the
Nasdaq Composite Index
was down 17 to 2585, although above its intraday low of 2574.51. The
Morgan Stanley High-Tech 35
was down 1.9% and the
Philadelphia Stock Exchange Semiconductor Index
was down 1%.
Those teen-techs, the Internets, also were caught stretching their legs.
TheStreet.com Internet Sector
index was falling 24 to 673.
Stein attributed the pullback in Internet stocks to companies such as
, down 2.3%, and
beating earnings estimates but not whisper numbers. "These undefined whisper numbers are causing some problems as people's expectations continue to exceed
numbers. Net stocks are mostly played through the Net so it's not institutional buying, which tends to have a better realization of expectations. It's like that movie your friends tell you to see because they just loved it. You go and it's all right, but you expected more."
was losing 2 to 1361, and the small-cap
-- which now seems not quite the rotation beneficiary it had seemed to be -- was unchanged at 435. For those Dow theorists in the crowd, the
Dow Jones Transportation Average
was up 0.7%.
Among individual names,
was plunging 48.5% after restating earnings results due to improperly recorded software sales. The news was exerting some pressure on the sector, as the
S&P Health Care Index
(which does not count McKesson as a component) was down 1.8%.
Market internals were mixed. On the
New York Stock Exchange
, advancers were leading decliners 1,670 to 1,172 on 542 million shares. But the downs had the ups 1,946 to 1,767 on 581 million shares in
Nasdaq Stock Market
activity. New 52-week highs were leading new lows 57 to 20 on the Big Board and 67 to 41 on the Nasdaq.
The 30-year Treasury was lowering 23/32 to 95 3/32, pushing its yield to 5.59%. (For more on the fixed-income market, see today's early
Wednesday's Midday Movers
There's only one upside to all this pain for McKesson: At least the
wholesale. Shares of the drug wholesaler were getting rocked at midday, lately down 31 3/4 to 34, or 48.5%, after the company restated its fourth-quarter earnings to 56 cents a share from 62 cents, citing improper recording of software sales. McKesson also restated its fiscal 1999 earnings to $1.97 from $2.06, and revised its fiscal 2000 goal downward to $2.50 from $3.
After an early surge, America Online had fallen back into its
overnight funk, lately down 3 9/16 to 149 7/16. AOL reported third-quarter earnings of 11 cents a share, beating the 34-analyst First Call estimate by 2 cents and up from the year-ago 4 cents. The numbers don't include results from
, which AOL acquired March 17 in a pooling-of-interests transaction, or other one-time items. TheStreet.com examined the report in
a story last night.
Day 2 of life in the public equities market is going well for digital communications firm
, which began trading yesterday. The stock lately was up 14 7/8 to 48 7/16, or 44.6%.
In other news:
was up 4 15/16 to 95 1/8, or 5.5%. The stock went ex-dividend today.
Specialty chemicals maker
is up 3 1/8 to 12 1/16, or 35.0%, on news that
will buy it for $400 million in cash, or $12.25 a share, and about $100 million in debt assumption.
First Liberty Financial
is up 8 1/2 to 31, or 38.1%, on news that North Carolina bank
is buying it in a $500 million stock swap. First Liberty shareholders will get 0.8525 BB&T for each First Liberty share, worth about $33.25 based on Monday's closing prices.
the world's largest manufacturer of stainless steel and silver-plated flatware, is up 3 1/2 to 24 3/4, or 16.5%, after its board of directors rejected an unsolicited takeover offer of $30 a share from glassware maker
"Whoa ... we've got a rocket!" wrote one investor on
Yahoo!'s message board for
U.S.-China Industrial Exchange
, an obscure distributor medical and industrial equipment in China and Hong Kong. Shares of the company, known as Chindex, were up 7 1/16, or a whopping 128.4%, to 13 on apparently no news whatsoever.
Shares of auto parts manufacturer
have lately jumped 7 1/4 to 19 1/2, or 59.2%, after the U.K.'s
said it will buy the auto parts manufacturer for about $570 million in cash and assumed debt. Walbro shareholders will get $20 cash for each Walbro share under the deal.
is up 7 to 88 5/8, or 8.6%, after the company reported first-quarter operating earnings of $1.08 a share, beating the 14-analyst estimate of $1.01 and up from the year-ago operating earnings of 90 cents.
In other earnings news: