Major Indices Turn Near Flat as Initial Market Euphoria Dissipates

Earnings releases are causing choppy trading.

Author:: Brian Louis
Publish date:: Apr 14, 1999 11:07 AM EDT

After opening strongly on the upside, the lingering bad taste of yesterday's postclose

Intel

(INTC) - Get Report

earnings release in part helped extinguish the early euphoria on Wall Street.

The

Dow Jones Industrial Average

was up 5 to 10,400. The

S&P 500

was down 2 to 1347. The

Nasdaq Composite Index

was up fractionally at 2584.

The small-cap

Russell 2000

was up 2 to 419.

TheStreet.com Internet Sector

index was down 14 to 762.

TheStreet.com E-Commerce Index

was up 2 to 148.

The 30-year Treasury bond was up 1/32 to 96 16/32, yielding 5.49%

Intel was down 2 1/2, or 4%, to 58 1/8. The chip giant said second-quarter revenue may be flat to slightly lower than the first quarter's $7.1 billion due to seasonal factors. Intel posted first-quarter earnings after the close yesterday of 57 cents a share, 2 cents above the 33-analyst

First Call

forecast and above the year-ago 36 cents. Sales in the quarter were lower than expected.

Despite good news from

J.P. Morgan

(JPM) - Get Report

Lucent

(LU)

and

Motorola

(MOT)

, "Intel overtook everything," said Peter Boockvar, equity strategist at

Miller Tabak Hirsch

J.P. Morgan, a Dow component, posted first-quarter earnings of $3.01 a share, blowing away the First Call 11-analyst estimate of $1.73 and up from the year-ago $1.80, which excludes a charge. J.P. Morgan said return on equity in the first quarter was 22%, compared with 13% a year ago. J.P. Morgan was up 5 5/8 to 135 1/16.

Motorola reported first-quarter earnings of 28 cents a share, topping the First Call 27-analyst outlook by 4 cents and exceeding the year-ago 23 cents.

Lucent said yesterday it expects second-quarter earnings to meet or beat analysts' expectations. It was up 3 5/16, or 6%, to 60 1/4.

On the plus side, Boockvar noted that investors have begun buying other areas of the market, pointing out that small-caps lately have begun to perk up.

He said PC-related stocks on a short-term basis have topped out, as have the financials, which he said have been "powerhouses."

Market breadth was strong.

On the

New York Stock Exchange

, advancers were beating decliners 1,480 to 1,096 on 250 million shares. On the

Nasdaq Stock Market

, winners were leading losers 1,829 to 1,397 on 463 million shares.

On the NYSE, 67 issues had set new 52-week highs while 27 had touched new lows. On the Nasdaq, 116 issues had set new highs while new lows totaled 28.

On the Big Board,

Compaq

(CPQ)

was most active, with 11 million shares changing hands. It was up 3/8, or 2%, to 24 1/4.

On the Nasdaq,

Sovereign Bancorp

(SVRN)

was most active, with 26 million shares changing hands. It was up 1 15/16, or 11%, to 19 3/8. Sovereign Bancorp, parent company of

Sovereign Bank

, said yesterday its executive management team met with sell-side analysts in New York and discussed with them Sovereign's technology initiatives, including plans for forming a separate Internet bank.