TheStreet.com's MIDDAY UPDATE
December 23, 1999
Market Data as of 12/23/99, 1:18 PM ET:
o Dow Jones Industrial Average: 11,387.10 up 183.50, 1.64%
o Nasdaq Composite Index: 3,979.33 up 42.03, 1.07%
o S&P 500: 1,456.14 up 20.15, 1.40%
o TSC Internet: 1,146.46 down 1.64, -0.14%
o Russell 2000: 483.50 up 5.56, 1.16%
o 30-Year Treasury: 95 08/32 down 13/32, yield 6.477%
In Today's Bulletin:
o Midday Musings: Nasdaq's Flirtation With 4000 Goes On as Dow Cruises Toward Record
o Wrong! Tactics and Strategies: Getting Out of the Game Will Cost You
Fox News Channel
Influential retail analyst
Thomas Weisel Partners
and chief market technician from
, join the regulars on "TheStreet.com" with a special holiday edition of the show. You'll hear if the group thinks a Santa Claus rally will come to Wall Street and how this record-breaking year will end. Also, we'll find out what retailers Faye Landes is hot on and our group will give their "Holiday Wi$hes" for investors.
Fox News Channel
airs Saturdays at 10 a.m.and 6 p.m. ET and Sundays at 10 a.m. ET. FNC is Fox's 24-hour cable news channel. To find
Fox News Channel
in your area, call your local cable operator or see our "TSC on Fox TV" page at www.thestreet.com/tv.
's message boards have personality! Check out these great conversations fueled by TSC's thought-provoking commentary. And make sure to visit the Community section every day for the latest discussions and information on upcoming chats and appearances.
James Cramer: The Market According to Cramer
Dagen McDowell: Dear Dagen
Ben Holmes: This Week in IPO's
Plus, Joe Bousquin will be talking about the "Century Club" funds on "Your World with Neil Cavuto" on Fox News Channel at 5 p.m. ET. Make sure to check out his recent piece "Triple-Digit Fund Returns? What's So Special About That?" at http://www.thestreet.com/funds/funds/845895.html.
Also on TheStreet.com:
Under the Hood: More Disclosure, Less BS: A Holiday Funds Wish List
And we want online trading discounts. Hey, we can wish, can't we?
Technician's Take: Want Some Cheese With Your Whine?
Yeah, yeah, it's not fair that B2B stocks are trumping value plays. Deal with it, says Gary.
Stock Strategies: On the 31st, the Early Bird Catches the Y2K Trading Plays
The new millennium starts at 6 a.m. Eastern time in Fiji. We walk you through the rest of the day.
Dear Dagen: Dear Dagen: A Year's Worth of Email, a Handful of Themes
A look at the subjects uppermost on your minds in '99.
Midday Musings: Nasdaq's Flirtation With 4000 Goes On as Dow Cruises Toward Record
12/23/99 1:21 PM ET
At the midday mark, Wall Street remained on a feverish course for a record-breaking -- and maybe millennium-mark-breaking -- day for the tech-laden
Nasdaq Composite Index
Since late October, the tech stocks have been on a hot streak, setting 28 record closes on the Nasdaq in 38 days. Although large-cap, highly valued tech stocks have been the fuel behind the Composite's fire, others give kudos to not only the tech darlings, but also to the surge in the number of market players.
"This is the same old same old," said Barry Berman, head trader at
Robert W. Baird
. "We're seeing more participation, with the advance/decline line 17 to 2 and volume almost 3 to 1. It's more than just tech."
Lately, the Nasdaq was racing up 43, or 1.1%, to 3980, just 20 points shy of the big 4000. It briefly traded as high as 4001.63, just after noon EST. Although several stocks were, as usual, tacking on huge gains,
was struggling, down 17 1/4 to 468 3/16 after it announced plans to sell its handset division.
The anything-tech craze is in full force, despite their high costs. As their prices continue to climb, players continue to buy, and stay in. And those Y2K woes? Forget about 'em. "Institutional investors seem to want to stay fully invested into the end of the year," said Jim Volk, co-director of institutional trading at
in Portland, Ore., citing the strong performance of Internet and business-to-business commerce stocks.
And we certainly can't forget about those nice, sizeable capital gains taxes that would hit those who opt to unload their positions before the first of the year.
So what will it take before we see a break from this tech trend? According to Brian Belski, chief market strategist at
George K. Baum
in Kansas City, Mo., the change has already begun. "We're starting to see the early stages, believe or not, some surprise group and sector activity including market-capitalization gains within such areas as basic materials and capital good stocks," he said, "which means that the market will likely show its traditional first-quarter deep cyclical bounces, which in turn, provides at least intermediate evidence of the broadening out."
Even though Belski sees history repeating itself, he still thinks tech will maintain strength even after the millennium date change. "Although traditionally, higher interest rates do not benefit growth stocks, the stock market, in terms of the trading, is recognizing that the growth projections and fundamental momentum within the tech sector more than compensate, relative to the impact of higher interest rates," he said. "I think the bond market is going to settle to a range that will provide a further platform for stock in general, especially tech."
Dow Jones Industrial Average
, which was once again losing the spotlight to the Nasdaq, was on a high of its own, jumping 172, or 1.5%, to 11,375. Heavyweight components
Johnson & Johnson
were giving lift to the index, which was on pace to top its
Aug. 25 closing high of 11,326.04.
As for financials
The American Stock Exchange Broker/Dealer index
was up 1.6%, showing across-the-board gains.
doing particularly well.
TheStreet.com Internet Sector
index was off a point to 1147, backing off from earlier strength despite big gains from
. Inktomi shares shot up 15 9/16, or 8.9%, to 192 1/2 after an upgrade from
was advancing 19, or 1.3%, to 1455, right through
yesterday's record closing high of 1435.99. The smaller-cap
was in 52-week high territory, up 5, or 1.1%, to 483. The Russell's April 21, 1998, closing high of 491.41 is closer at hand than it's been since way back then.
New York Stock Exchange:
1,846 advancers, 1,089 decliners, 478 million shares. 88 new 52-week highs, 159 new lows.
Nasdaq Stock Market:
, 2,144 advancers, 1,801 decliners, 828 million shares. 246 new highs, 94 new lows.
Thursday's Midday Watchlist
was at the head of the pack amid a broad Nasdaq rally, rising 44 1/4, or 23%, to 234 3/4, followed closely by
flying 35 3/4, or 6.5%, to 587.
Mergers, acquisitions and joint ventures
Citicorp International Finance
has agreed to take a 20% stake in the company. The interest is valued at roughly $40 million. Shares of Citigroup climbed 1 to 56.
This year's Nasdaq star, Qualcomm, wasn't looking quite so bright today. Shares dropped 17 1/4 to 468 3/16 after the company announced after yesterday's close that Japan-based
has agreed to purchase Qualcomm's consumer phone division for an undisclosed amount. Qualcomm said the sale would result in a one-time pretax charge of roughly $30 million in the first-quarter of fiscal 2000.
The deal calls for Kyocera to acquire Qualcomm's wireless phone businesses that use
Code Division Multiple Access
as well as its phone inventory, manufacturing equipment and customer orders. Kyocera also entered a five-year agreement to buy Qualcomm's CDMA chipsets and system software. The deal is set for completion by the end of February 2000. Then again, what would be a disastrous drop in share price for most stocks hardly made a scratch on Qualcomm. Today, Lehman Brothers upped its price target on Qualcomm to 520 from 450.
Banc of America Securities
lifted its 2000 earnings estimates to $4.00 a share from $3.85.
climbed 7/16 to 40 15/16 after it said it has agreed to partnerships with
to modernize Swiss telecommunications. Siemens and Cisco are set to begin work as early as January. Cisco rose 1 9/16 to 104.
Lehman Brothers said it "slightly reduced" its position in Cisco and put the proceeds into
in its U.S. strategy portfolio for 2000. Applied Materials was adding 1 7/16 to 122 1/2.
said it holds the right to up its $1.9 billion offer for Ireland's
Esat Telecom Group
but said it is not currently considering an increase. Yesterday, Telenor raised its offer to Esat by $300 million. Esat gained 1 1/4 to 91 1/4
climbed 1 11/16 to 84 5/8 after it said a Delaware state court has set a Jan.10 court date to review its motion to block
attempt to replace Warner-Lambert's board. Pfizer was rising 1/4 to 34. The court date marks a victory for Warner-Lambert in the heated merger battle with Pfizer.
The battle began after Pfizer launched a hostile bid for Warner-Lambert despite its plans to link with
American Home Products
. AHP inched up 1/4 to 40 1/4..
added 1/2 to 49 after CEO Chris Gent said that the takeover bid for
should be considered final, and there are no plans to launch a sweetened offer. Gent said that only a competing bid from another company would prompt Vodafone to consider upping its bid.
Earnings/revenue reports and previews
Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified.
slipped 5/8 to 75 3/8 after it posted first-quarter earnings of $1.19 a share after yesterday's close, beating the 23-analyst estimate of 85 cents and the year-ago 19-cent loss.
Deutsche Banc Alex. Brown
upped its 2000 earnings estimate to $3.79 a share from $1.80.
added 11/16 to 15 5/8 after it said its same-store sales for the holiday shopping season have reached "double-digit" growth so far. Last year, December sales rose 8%. CEO Richard Thalheimer said Web sales have risen six-fold in the period.
Morgan Stanley Dean Witter
upped its rating on
to outperform from neutral and set a price target of 48. Boeing climbed 1 11/16 to 41 1/16.
upped its rating on
to near-term accumulate from neutral. Brightpoint was beaming 3 7/16, or 30.2%, to 14 7/8.
initiated coverage of
with a buy rating and set a price target between 200 to 205. Brocade bounced up 6 1/16 to 157 1/4.
U.S. Bancorp Piper Jaffray
fiscal first-quarter EPS estimate to 35 cents from 25 cents and raised its price target to a range of 45 to 50. CDO fell 1 11/16 to 38 13/16 despite the news.
Morgan Stanley Dean Witter raised it price target on
to 110 from 90. Home Depot gained 1 1/8 to 97 1/2.
Lehman Brothers raised
to buy from outperform and raised its price target to 117 from 73. Shares popped 12 1/4, or 14.2%, to 98 1/4.
Warburg Dillon Read
cut its fiscal 2000 loss estimate on
to 74 cents a share to $1.16 a share and upped its fiscal 1999 loss estimate to $1.52 a share from 50 cents a share. IMCL was sliding 3/4 to 40.
Merrill Lynch upped shares of Inktomi to near-term accumulate from neutral. Inktomi rode up 15 9/16, or 8.8%, to 191 3/4.
Warburg Dillon Read upped its rating on
to buy and set a price target of 31. Shares moved up 1 7/16, or 6%, to 25 5/16.
U.S. Bancorp Piper Jaffray cut its fourth-quarter estimate on
Research in Motion
to 6 cents a share from 7 cents and fiscal 2001 estimate to 45 cents from 50 cents. Shares climbed 1 7/16 to 44 7/16 despite the news.
Credit Suisse First Boston
rolled out coverage of
with a hold rating. Shares gained 1/2 to 48 1/4.
initiated coverage of
with an attractive rating and set a price target of 15. Semco inched up 1/16 to 12 1/16.
Merrill Lynch raised its rating on
to a near-term buy from an accumulate Tandy tacked on 4 3/8, or 10.3%, to 46 7/8.
cut its 2000 earnings estimate on
to 85 cents a share from $1.00. Shares popped 1 1/16to 36 15/16.
gained 2 to 110 after
The Wall Street Journal
reported it filed a lawsuit against competitor
, claiming that EMC infringed upon a patent agreement and committed fraud by moving the patents to a shell company. The
reported that EMC said the proceedings were frivolous and it had fulfilled the agreement. EMC gained 3/4 to 100.
Read more about the
suit in a separate story from the
gained 1 1/4 to 118 3/4 after it said late yesterday that it has tapped company executive John Connors to be its new CFO. Connors is replacing
, who stepped down to accept the CEO position at Vancouver-based
. This morning, Credit Suisse First Boston maintained its strong buy rating on the stock, saying it feels Maffei's resignation would not have "any meaningful impact" on the company. PaineWebber raised its price target on Microsoft to 150.
For more on the changing of the financial guard at Microsoft, take a look at the
story written last evening by
lifted 2 3/8, or 18.4%, to 15 5/16 after it said its rocket was chosen by
to launch two satellites.
Wrong! Tactics and Strategies: Getting Out of the Game Will Cost You
James J. Cramer
12/23/99 10:22 AM ET
Why bother to sell? You incur taxes. You get out when others want in. You run the risk of missing a 40-point move. A 40-point move!!!! A 40-point move!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! (Have I emphasized that appropriately?)
And which particular 40-point move am I talking about today? Try
. What happened with Vitria, a stock I intended to draft first in my supplemental draft with
Matt "B2B" Jacobs
? It got mentioned by
Gary B. Smith
in this morning's
column as a great chart.
No research. No news. Just a GBS special. For 10 bucks a month, the guy just made you 40 big ones.
Join the discussion on
Cramer's Latest, go to the
Red Hots Forum
, or visit our
Oops, make that a 50-point move.
What a sector!!
I keep asking myself, where are the sellers? And I keep hearing that litany. We have created a generation of people who think it is sinful to sell, flip or take things off the table. A generation of people who would rather ride something down than pay the tax man. A generation of people who know one thing: Hold it today, there will be a buyer willing to pay more tomorrow.
And who am I to say that generation is wrong?
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. Cramer's fund may be long or short certain stocks in his B2B rotisserie league or Red Hot index. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at
Copyright 1999, TheStreet.com