Market Inspires No Dancing in the Streets, but No Weeping Either

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Surprise, surprise, surprise. In a day

Jim Nabors

would love (and not because of its melodic qualities), stocks overcame early jitters as fears about a Brazilian devaluation faded.

But it was far from

carnival

on Wall Street, as secondary names lagged blue-chips for the first time in recent memory. Big names in technology, finance and retailing led an advance notable mainly for its lack of pizzazz.

The

Dow Jones Industrial Average

dipped as low as 8328.71 in its initial move, but soon recovered and spent most of the day in modestly positive ground. The index rose as high as 8432.98 before closing up 5.93, or 0.1%, to 8371.97.

The blue-chip proxy was restrained by

DuPont

(DD) - Get Report

, which fell 4.5% in the wake of a critical

Wall Street Journal

article.

The

Nasdaq Composite Index

was the session's biggest gainer, rising as high as 1738.37 before closing up 19.72, or 1.2%, to 1737.35. Tech stalwarts

Dell

(DELL) - Get Report

,

Cisco

(CSCO) - Get Report

, and

Intel

(INTC) - Get Report

were on the rise, sending the

Nasdaq 100

up 1.7%. Big Board tech denizens gained as well, helping the

Morgan Stanley High-Tech 35

rise 2.2%.

Additionally, Internet names were also higher following

last night's bullish profit report from

America Online

(AOL)

, which gained 1.8%. The

American Stock Exchange Inter@ctive Week Internet Index

rose 2.8%.

The

S&P 500

rose 2.75, or 0.3%, to 1068.09, while the

Russell 2000

fell 0.03, or 0.01%, to 371.47.

In

New York Stock Exchange

trading a modest 679.5 million shares were exchanged while declining stocks led 1,522 to 1,442. In

Nasdaq Stock Market

action, 785.9 million shares traded while advancers led 2,085 to 1,904. New 52-week highs led new lows 29 to 22 on the Big Board but new lows led 82 to 29 in over-the-counter trading.

Traders weren't overly disconcerted by the inability of the Dow and the S&P to sustain intraday highs.

"I think what's going on is a consolidation of the gains we've made in last two or three weeks," said Ned Collins, executive vice president of U.S. stocks at

Daiwa Securities America

. "We had an impressive, powerful move across the board and stocks performed so well they got ahead of themselves."

The action in financial stocks today was "encouraging," Collins said, but he rebutted the notion the worst is behind the overall market. "We're going to have volatility and backing and filling while people try to determine whether we've seen the lows or this is a very impressive rally in a bear market," the trader said. "No one has a real good handle on that yet."

Don't cry for me ... Brazil?

The details of President

Fernando Henrique Cardoso's

$23.5 billion austerity plan were unveiled today with nary a mention of devaluation.

Yesterday, Brazilian officials denied speculation such action is forthcoming. The effort to curb inflation via spending cuts and tax hikes is expected to pave the way for some $30 billion of assistance from the world community, the bulk from the

International Monetary Fund

.

Brazilian traders hardly embraced the plan, however, as the

Bovespa

fell 0.6%. In New York, ADRs of

Telebras

(TBR)

, which has a big exposure to Latin America, slid 3.9% on a day when most financial names rallied.

The situation with Brazil the past few days reflects that international markets still have the power to roil Wall Street. But barring a true calamity, the overriding optimism that has reemerged here is not easily shaken.

"I think the global situation is not going to clear up anytime soon, and you're going to continue to hear horror stories," said Bruce Bittles, market strategist at

J.C. Bradford

in Nashville, Tenn. "But if the market sells off it will be a buying opportunity now that the

Fed

has taken the posture it has."

A bear returns to the bullish fold

Bittles, who turned negative on the market last spring -- before it became fashionable -- became bullish again on

Oct. 15, when the Fed issued its intermeeting ease. On that day, his asset allocation model was revised to 50% each for stocks and bonds from 50% bonds, 40% stocks and 10% cash previously.

"I think the way the Fed did it -- late in the day,

which squeezed the shorts -- said they were going to do whatever it takes" to keep the market afloat, the strategist said. "I think eventually

major averages will work their way up to old highs. Whether they hit new highs or not depends on how corporate earnings will hold up in this environment of slower growth. But I think interest rates are going to be more important than earnings for a time."

Bittles declined to discuss individual stocks but favors small- and medium-sized companies because "they'd gotten so out of line of historic performance." He attributed their relative weakness today to the fact this is the last week of the month for mutual funds to engage in any "tax-loss selling" not already completed.

In terms of groups, the strategist favors financial stocks and retailers, which both rebounded from yesterday's weakness.

With financial giants

J.P. Morgan

(JPM) - Get Report

up 1.7% and

Merrill Lynch

(MER)

higher by 2.4%. to lead the way, the

Philadelphia Stock Exchange/KBW Bank Index

gained 1.2% while the

American Stock Exchange Broker/Dealer Index

rose 0.6%.

Among retailers,

Wal-Mart

(WMT) - Get Report

rose 2.5% and

Home Depot

(HD) - Get Report

climbed 3.8% to help push the

American Stock Exchange Retailing Index

up 1.4%

Among other indices, the

Dow Jones Transportation Average

fell 15.43, or 0.6%, to 2750.24; the

Dow Jones Utility Average

gained 1.98, or 0.7%, to 300.28; and the

American Stock Exchange Composite Index

rose 2.14, or 0.3%, to 634.52.

The price of the 30-year Treasury bond fell 19/32 to 105 19/32, sending its yield up to 5.13%.

Elsewhere in North American equities, the

Toronto Stock Exchange 300

rose 37.02, or 0.6%, to 6033.79 and the

Mexican Stock Exchange IPC Index

tumbled 73.78, or 1.9%, to 3843.67.

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last night, America Online picked up 2 1/8 to 124 1/8 while

eBay

(EBAY) - Get Report

slipped 2 9/16 to 80.

Earnings/revenue reports and previews

Budget Group

(BD)

tanked 5 7/16, or 23.3%, to 17 15/16 despite late yesterday reporting third-quarter net profits of $1.38 a share, up from 99 cents a year ago. Today, analysts told

Reuters

the company's quarter operating figure was below the seven-analyst consensus for $1.35.

CMI

(CMX)

shot up 1 7/16, or 23%, to 7 11/16 after reporting third-quarter earnings of 9 cents a share, up from 7 cents a year ago. The company also forecast its fourth-quarter results could be up as much as 100% sequentially. No estimates were available.

HealthSouth

(HRC) - Get Report

hopped 1 3/4, or 16.1%, to 12 5/8 after posting third-quarter earnings of 28 cents a share, in line with estimates, yesterday.

InfoUSA

(IUSAB)

skidded 11/16, or 14.5%, to 4 3/16 after posting a third-quarter loss of 27 cents a share, reversing a profit of 2 cents a year ago and well shy of the 15-cent profit expected by the five-analyst consensus. The loss includes $21.4 million in pretax charges; results excluding the charges were not provided.

Intermedia Communications

(ICIX)

shaved off 7 5/8, or 30.2%, to 17 3/4 after late yesterday reporting a third-quarter loss of $2.42 a share, well in excess of the 16-analyst consensus for a shortfall of $2.08 and year-ago loss of $1.62.

Merrill Lynch

lowered its long-term rating to accumulate from buy and its near-term rating to neutral from buy.

Goldman Sachs

removed the stock from its recommended list, dropping it to market perform.

Interplay Entertainment

(IPLY)

collapsed 1 1/8, or 42.9%, to 1 1/2, matching an all-time low, after late yesterday posting a third-quarter loss of 83 cents a share, wider than the 49-cent loss of a year ago and well shy of the three-analyst consensus of a nickel profit. Interplay warned that its fourth-quarter results would be shy of expectations, currently at profits of 20 cents. The company said it has engaged

Piper Jaffray

to help it pursue strategic alternatives. Today,

Bear Stearns

dropped it to neutral from buy.

Kitty Hawk

(KTTY)

slouched 3 7/8, or 27.2%, to 10 3/8 after saying late yesterday it expects third-quarter earnings to come in at 13 cents to 15 cents a share. The two-analyst forecast called for earnings of 38 cents vs. the year-ago 7 cents.

BT Alex. Brown

lowered the stock to market perform from buy and

Morgan Stanley Dean Witter

cut its view to neutral from strong buy.

Lernout & Hauspie

(LHSPF)

lowered 6 3/4, or 14.9%, to 38 9/16 despite late yesterday reporting third-quarter earnings of 22 cents a share, a penny ahead of the five-analyst view and up from 13 cents a year ago. The speech technology company said it will have to reduce write-offs for acquisitions taken previously due to new

Securities & Exchange Commission

guidelines. The reduction will result in a corresponding increase in good will.

TheStreet.com

took a closer look at the report in a

story today.

MTI Technology

(MTIC)

shed 1 13/16, or 36.3%, to an annual low of 3 3/16 after posting second-quarter earnings of 3 cents per share, down from 14 cents a year ago and 11 cents shy of the five-analyst forecast. The company forecast weaker-than-expected third-quarter results, currently expected to be 18 cents a share.

National Instrument

(NATI) - Get Report

grew 3 1/4, or 13.3%, to 27 7/8 although its third-quarter report last night included a profit of 25 cents a share, a penny shy of the six-analyst consensus and flat from year-ago results.

Old Republic International

(ORI) - Get Report

slipped 4, or 18.2%, to 18 after missing third-quarter earnings forecasts by 3 cents a share yesterday.

Schlotzsky's

(BUNZ)

gave up 1, or 9.4%, to 9 5/8 after late yesterday posting third-quarter profits of 21 cents a share, 3 cents shy of the five-analyst consensus and flat from year-ago results.

Snyder Oil

(SNY) - Get Report

slid 1 7/16, or 8.4%, to 15 3/4 after warning its third-quarter earnings will be hurt by damage sustained to oil rigs during tropical storms. The 10-analyst view is currently for a loss of 23 cents in the quarter.

Spartan Motors

(SPAR) - Get Report

hopped 1 3/8, or 25.6%, to 6 7/8 after posting third-quarter profits of 16 cents a share, reversing a loss of 12 cents in the prior year. No estimates were available.

Sunrise Medical

(SMD)

jumped 1 5/16, or 13.6%, to 11 after late yesterday reporting first-quarter profits of 16 cents a share, 2 cents ahead of the four-analyst consensus and well above year-ago results of 4 cents.

Tekelec

(TKLC)

lost 3 5/16, or 14.9%, to 19 1/16 despite late yesterday reporting third-quarter results of 18 cents a share, 3 cents ahead of the five-analyst consensus and up from 11 cents a year ago.

United Stationers

(USTR)

fell 3 11/16, or 13.5%, to 23 3/4 even after beating the five-analyst consensus of 47 cents a share by a nickel with its third-quarter profits last night.

VWR Scientific

(VWRX)

dropped 3 1/2, or 12.6%, to 24 1/4 after it reported third-quarter earnings flat from year-ago levels and 4 cents shy estimates last night. Today, BT Alex. Brown cut it to buy from strong buy.

Additional earnings news is compiled in a separate table

.

Mergers, acquisitions and joint ventures

Fluor Daniel

powered up 2 3/8, or 42.2%, to 8 1/16 after

International Technology

(ITX)

agreed to acquire the unit of

Fluor

(FLR) - Get Report

for $36.3 million in cash. International Technology grew 1, or 12.9%, to 8 3/4 and Fluor added 1/8 to 38 1/2 on the news.

Interstate/Johnson Lane

(IJL)

sank 6 7/16, or 17.4%, to 30 9/16 after agreeing to be acquired by

Wachovia

(WB) - Get Report

in a stock swap worth $230 million. Interstate shares had risen sharply in anticipation of a buyout. Wachovia took in 2 5/8 to 85 3/8.

Offerings and stock actions

Associated Materials

(SIDE)

lifted 1 1/2, or 15.8%, to 11 after the company approved the buyback of up to 800,000 shares.

Analyst actions

Amgen

(AMGN) - Get Report

lost 1/4 to 77 1/4 even after

Credit Suisse First Boston

upped it to buy from hold.

Holt's Cigar

(HOLT)

scored 2 1/8, or 44.7%, to 6 15/16 after being upgraded to strong buy from hold at

Prudential Securities

.

McKesson

(MCK) - Get Report

added 2 5/16 to 74 7/8 after Goldman Sachs added the stock to its recommended list, raising it from market outperform.

Qwest Communications

(QWST)

surged 1 9/16 to 38 1/16 after Bear Stearns initiated coverage with a buy.

Verio

(VRIO)

fell 4 3/16, or 23.3%, to an all-time low of 13 7/8 after

Deutsche Bank Securities

slashed it to accumulate from buy.