Market Muddles Through Uninspiring Session While Waiting for PPI - TheStreet

Market Muddles Through Uninspiring Session While Waiting for PPI

The major indices have not done a whole lot since this morning, ahead of tomorrow's economic releases.
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At midday, investors were still not giving into that "buy low" temptation brought on by the past two trading session selloffs. With the

Dow

muddling around its positive opening, maybe market movers and makers are looking before they jump. Just like the self-indulgent children who visited

Willy Wonka's Chocolate Factory found out, succumbing to temptation might not be that sweet.

On the eve of the

Producer Price Index

announcement, coupled with an expected rate hike looming in November, many investors are paying full attention to the, "invest at your own risk" signs that are plastered all over the market.

"I think the market is searching for a bottom here," said Dan Marciano, head of trading at

First Albany

, while reflecting on tomorrow's PPI announcement and next week's CPI numbers. "Basically, Greenspan has put the fear of God in people. When we discuss all of the possible scenarios that could come out of the last

FOMC

meeting, I said that the worse scenario would be switching its bias, which it did," Marciano added.

"Producer Price Index could show inflationary pressures are pretty strong, putting a lid on this mornings rally," said Bruce Bittles, market strategist at

J.C. Bradford

, agreeing that tomorrow's report could hinder a positive market.

The Dow Jones Industrial Average

was up 38, or 0.4%, to 10,270, with

American Express

(AXP) - Get Report

tumbling 1 to 141 leading the decline.

The

Philadelphia Stock Exchange/KBW Bank Index

, which was sinking 1.4 to 742.

The tech-heavy

Nasdaq Composite Index

was in red territory, stumbling 3.1 to 2798.

Qualcom

(QCOM) - Get Report

, losing 5 1/2 to 199 and

VISX

(VISX)

, skidding 4 7/16 to 199 15/16, despite an estimate upgrade from

BancBoston Robertson Stephens

.

Shares of

Redback

(RBAK)

were plummeting 10 1/16 to 125 on the Nasdaq, after the company posted a third-quarter loss yesterday evening and fell prey to a downgrade by

U.S. Bancorp Piper Jaffray

.

In

New York Stock Exchange

news,

Tyco

(TYC)

was still faltering from yesterday's accounting problems scare, down 7, or 7.2%, to 90, while

Unisys

(UIS) - Get Report

was also performing poorly, tumbling 15 1/4, or 36.1%, to 27 after reporting soft revenues.

While some investors might be considering third-quarter earnings to gauge their decisions, others are looking to the bond market for guidance.

"Bonds are really running the show here and equities are reacting to the bonds," said Brian Gilmartin, portfolio manager at

Trinity Asset Management

. Corporate earnings have already been discounted, Gilmartin added.

On the bond front, the benchmark 30-year Treasury was down 0.16 to 97.14, with its yield 6.31%.

Other stock proxies were also bleeding, with the broad

S&P 500

down 2.1 to 1283, while the small-cap

Russell 2000

fell 1.1 to 418. The

Street.com Internet Index

was contradicting other indices, bouncing 6.4 to 698, with

Yahoo

(YHOO)

and

America Online

(AOL)

gaining ground.

In other Big Board news, decliners were leveling advancers, 1831 to 996 on 513 million shares, while on the Nasdaq, laggards were also edging out leaders 2011 to 1488 on 596 million shares. The new 52-week lows were pummeling the new 52-week highs on the NYSE, 276 to 17, while on the Nasdaq new lows were also beating out highs 92 to 43.

Thursday's Midday Watchlist

By Eileen Kinsella
Staff Reporter

(

Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified. New highs and lows on a closing basis unless otherwise specified.

)

Intel

(INTC) - Get Report

fell 1/8 to 72 after it agreed to buy

DSP Communications

(DSP)

for around $1.5 billion in cash. Intel is paying $36 a share for DSP, a hefty premium over DSP's closing price of 28 yesterday. DSP racked up 7 3/16, or 25.7%, to 35 3/16.

Earnings/revenue reports and previews

Apple Computer

(AAPL) - Get Report

shined up 6 3/8, or 9.9%, to 70 7/16 after posting fourth-quarter earnings last night of 51 cents a share, beating the downwardly revised 17-analyst estimate of 45 cents, but down from the year-ago 68 cents.

Donaldson Lufkin & Jenrette

upped Apple to top pick from buy, while

Credit Suisse First Boston

raised its 2000 earnings estimates to $3.20 from $3.15 per share.

AlliedSignal

(ALD)

slipped 1/16 to 58 1/4 after posting third-quarter operating earnings of 68 cents a share, in line with the 14-analyst estimate and up from the year-ago 58 cents.

Bausch & Lomb

(BOL)

lost sight of 3 1/2, or 5.3%, to 62 5/8 despite reporting third-quarter earnings of 78 cents a share, well above the 10-analyst estimate of 63 cents and up from the year-ago 64 cents.

Boise Cascade

(BCC) - Get Report

edged up 7/16 to 36 3/16 after posting third-quarter earnings of 74 cents a share, beating the 11-analyst estimate of 70 cents and up from the year-ago operating earnings of 14 cents.

General Motors

(GM) - Get Report

fell 13/16 to 64 5/16 after posting third-quarter earnings of $1.33 a share, beating the 13-analyst estimate of $1.24.

Champion International

(CHA) - Get Report

chalked up an extra 2 7/8, or 5.3%, to 56 3/4 after it posted third-quarter earnings of 80 cents a share, which excludes a charge of 2 cents, well above the 13-analyst estimate of 63 cents and up from the year-ago 32 cents.

Deluxe

(DLX) - Get Report

moved down 1 3/16 to 33 1/2 after posting third-quarter earnings of 65 cents a share, in line with the four-analyst estimate.

First Union

(FTU)

fell 1 7/16 to 35 11/16 after it reported third-quarter operating earnings of 84 cents a share, in line with the 24-analyst estimate, but down from the year-ago $1.02.

Greenpoint Financial

(GPT)

slipped 1/16 to 26 5/16 after posting third-quarter earnings of 63 cents a share, above the 14-analyst estimate of 58 cents and up from the year-ago 57 cents.

Intermet

(INMT)

edged up 1/4 to 9 5/8 after reporting third-quarter earnings of 29 cents a share, a penny better than the six-analyst estimate, but down from the year-ago 36 cents.

Kimball International

(KBALB)

slipped 15/16 to 17 3/4 after posting first-quarter earnings of 29 cents a share, below the three-analyst estimate of 32 cents and the year-ago 31 cents.

KLA-Tencor

(KLAC) - Get Report

rose 11/16 to 74 5/8 after posting first-quarter earnings of 38 cents a share, better than the 19-analyst estimate of 33 cents, and up from a year ago 11 cents.

McGraw-Hill

(MHP)

inched up 5/16 to 51 9/16 after it posted third-quarter earnings of 96 cents a share, beating the 10-analyst estimate of 92 cents.

Polaroid

(PRD)

wasn't looking picture-perfect, down 3 13/16, or 15%, to 21 9/16 after reporting third-quarter operating earnings of 50 cents a share, in line with the nine-analyst estimate and up from the year-ago 40 cents.

Schwab

(SCH)

climbed 3/4 to 28 13/16 after it posted third-quarter earnings of 15 cents a share, in line with the 10-analyst estimate and up from the year-ago 12 cents.

Unisys plummeted 13 1/8, or 31.4%, to 29 despite reporting third-quarter earnings of 40 cents a share, above the 11-analyst estimate of 36 cents and up from 25 cents a year ago.

PaineWebber

downgraded Unisys to neutral from attractive.

USFreightways

(USFC)

skidded 1 15/16 to 41 11/16 after reporting third-quarter earnings of $1.07 a share, well above the nine-analyst estimate of $1 and up from a year-ago 74 cents.

Westinghouse Air Brake

(WAB) - Get Report

fell 1/8 to 16 13/16 after posting third-quarter earnings of 48 cents a share, in line with the five-analyst estimate and up from 42 cents a year ago.

Westpoint Stevens

(WPSN)

lost 9/16 to 21 7/8 after reporting third-quarter earnings of 67 cents a share, in line with the 11-analyst estimate and up from a year-ago 57 cents. The company said weather problems reduced income by about $700,000, or 1 cent a share.

Analyst actions

Starwood Hotels & Resorts Worldwide

(HOT)

cooled 1 to 20 after PaineWebber downgraded it to neutral from buy.

United Technologies

climbed 1/8 to 53 5/16 after PaineWebber initiated coverage with an attractive rating.

Miscellany

priceline.com

(PCLN)

fell 3 1/8 to 69 3/8 after it filed suit in federal court against

Microsoft

(MSFT) - Get Report

and its

Expedia

unit, claiming that

Expedia.com's

recently introduced hotel service infringes on priceline.com's patent. Shares of Microsoft slipped 13/16 to 90 3/8.

Separately, Microsoft formed an alliance with

British Telecommunications

(BTY)

, lately up 2 3/4 to 163, to combine resources to develop handheld wireless devices using

Windows CE

as the operating system.

Sony

(SNE) - Get Report

climbed 2 7/8, to 156 1/4 after saying it was planning a $150 million holiday marketing budget for its Playstation including tie-ins with

Pizza Hut

, a unit of

Tricon Global Restaurants

(YUM) - Get Report

and

MTV

, a unit of

Viacom

(VIA) - Get Report

.