Yup, you guessed it: More uncertainty about the earnings outlook brought the stock market another terrible start. In what has become a familiar pattern on Wall Street, the
Dow Jones Industrial Average took a dive soon after the open, and the
Nasdaq Composite Index racked up its own losses.
On the heels of the lowest close on the Nasdaq since Oct. 30, 1998, the tech-heavy index had lately dropped below 1750, another benchmark level. Last night's battery of profit warnings were centered on the tech sector. A day after the end of the latest quarter, a late batch of confessions about upcoming earnings reports hit the marketplace. Most likely, the companies that warned had been hoping, if only desperately, that end-of-the-quarter sales would allow them to match earlier, more optimistic estimates.
Yesterday's roster of profit warnings included B2B play
, down 16.3% to $5.38, networker
, off 10.2% to $10.52, Internet infrastructure software developer
, off a whopping 37.3% to $3.90 and e-services firm
, lower by 25.3% to $7.28.
If this latest round of earnings news is any indication about the future, there are probably lots more companies with last-minute disappointments up their sleeves. According to market experts, until the earnings picture brightens, the stock market outlook will darken. This morning,
Salomon Smith Barney
cut its 2001 year-end target for the Dow to 11,400 from 11,750. The blue-chip index closed down yesterday to 9778. But Salomon analyst Tobias Levkovich upped his equity rating to 70% from 65%.
Also weighing on today's market is tension overseas. Today marks day three of the standoff between China and the U.S. over an American spy plane that is being held in China. Chinese president Jiang Zemin is asking for the U.S. to accept full responsibility for the collision between a Chinese fighter plane and the U.S. plane and to halt surveillance missions near China's coasts.
was one of the few bright spots. It was up 2.6% to $39 after it said it expects first quarter operating earnings to come in 10% to 15% above the high-end of analysts estimates. Entergy on Monday said it abandoned a planned merger with
. And Electronics retailer
, soaring 15.7% to $42.59, beat first quarter targets by 7 cents per share, coming out with earnings of 89 cents per share.