It isn't too pretty out there.
With the next quarter's doomsayers emerging so soon, and whispers of
Nasdaq 2000 settling over Wall Street, the major indices took a spill at the open. The Nasdaq was already at levels it hadn't seen since January 1999, the
S&P 500 is very nearly in a bear market for first time in 10 years and the
Dow is down 2.4% on the year.
Still, it's not over yet. The major indices tried to pull off a rally yesterday afternoon, however unsuccessfully.
And networking giant
revised fiscal third-quarter earnings and revenue guidance after the close of regular trading yesterday. Sun was the most actively traded stock on the Nasdaq, falling 3.6% to $20.13.
warned this morning it will miss already lowered first-quarter earnings estimates and might even post a loss. Motorola was off 5.9% to $16.28, and was one of the top three most-actively traded stocks on the
New York Stock Exchange.
Of course, Sun's news was really no shock. The company's shares have plunged over the last week as
investors worried that Sun would make just such an announcement on its regularly scheduled quarterly call. But analysts were
backpedaling on the stock this morning.
, which has the stock on its recommended list,
Credit Suisse First Boston
, which rates it a buy, and
, which rates it strong buy, have done the usual, cutting estimates to reflect company guidance. They all maintained their existing ratings.
Things remained weak all across tech and telecom, financials were weak and even the defensive sectors weren't getting much of a boost. Specialty chipmakers
were falling after being
downgraded by Lehman Brothers. Altera was falling 3.6% to $25.19 and Xilinx was off 4.9% to $40.75. The
Philadelphia Stock Exchange Semiconductor Index
was down 3.6%. PC makers and Internet stocks were also down, while biotech was only marginally lower.
The networkers were getting hit after
Morgan Stanley Dean Witter
cut its price target on sector darling
to $50 from $95. JDS was falling 3.3% to $29.56,
, which warned of slowing in coming quarters late last week, was falling 3% to $19.34. And
, which saw their ratings cut by Goldman Sachs, were sliding 7.1% and 7.4%, in that order.
Dow was getting hit hardest by bellwether
Salomon Smith Barney
cut the company's price target, to $135 from $140 and shaved its third-quarter sales and profit targets. IBM was cutting 30.8 weighted points from the Dow. Two-thirds of the index's 30 stocks were in the red, while
was contributing the most upside; the stock was up 2.2% to $56.38. Another Dow component, automobile giant
was up 0.7% after announcing it
expected it to meet its year-end targets.
Communications equipment and software giant
was also a popular trade this morning, and was among the top three most-actives on the NYSE. Lucent was up 1% after announcing this morning that it has successfully secured $6.5 billion in new financing. Lucent, which has faced more than its share of
financial woes, said it secured credit facilities of up to $4.5 billion from
and Salomon Smith Barney. Some of this sum replaces earlier expired facilities, while a portion of the debt will be assumed by spinoff
initial public offering. The remaining $2 billion includes an amendment to a credit line that had been due in 2003.
Investors have begun to doubt earlier predictions that the economy and earnings are destined recover in the second half of this year. A new round of major earnings warnings in the past month has pushed some pros to start looking farther out.
Back to top
Gold stocks seemed to be the only ones making a significant move up this morning. The
Philadelphia Stock Exchange Gold and Silver Index
was up 2.8%.
Back to top
The benchmark 10-year
Treasury note was up 12/32 to 99 5/32, yielding 5.109%.
Back to top