After a run-up at the open, stocks finally ran into some of that selling pressure that people have been talking about.
"It looks like investors are finally taking the opportunity to realize some of these gains they have," said Bill Allyn, head of block trading at
. But far more surprising than the settling in of a little profit-taking is how long it took to come. The
Nasdaq Composite Index
is up more than 45% from its October lows, and many on Wall Street were, quite rationally, expecting tech stocks to pull back and tread water a month ago.
But stocks -- or at least tech stocks -- have not been adhering to what Wall Street thinks of as rational. There's evidence individual investors are playing a greater part in this market than ever before.
Volume, for instance, has been huge on the
Nasdaq Stock Market
relative to the
New York Stock Exchange
. And despite the high Nasdaq volume, there aren't many block trades going off in four-letter names.
Implied volatility, a pretty good read of professional investor sentiment, shows a decline in bullishness over the last month. Typically, as sentiment drops, so does the market (when it troughs, it's supposed to be time to buy). Yet despite the turn in sentiment among the professional crowd, the big indices keep going higher.
Eventually, the market should pull back, or at least tread water, but that moment hasn't come yet despite today's selling, said
strategist Steve Goldman.
"It's hard to get any sustainable declines this time of year," he said. "You have a lot of momentum and you have a lot of seasonal factors." Goldman reckons that in mid-January, as those year-end factors abate and investors start worrying about interest rates again, the market could get a little rockier.
In the middle of the lunch hour, the
Dow Jones Industrial Average
was a little deeper into record territory with a gain of 19 to 11,424, but none of the other major indices were flashing green.
The Nasdaq was down 65, or 1.6%, to 3905, beating a steady retreat after popping up to a new intraday high of 4001.90 on the open. The
was off 7, or 0.5%, to 1451, and the smallish-cap
was down 3, or 0.6%, to 480.
TheStreet.com Internet Sector
index was down 40, or 3.6%, to 1088. E-tailers were getting hit on reports that they didn't handle Christmas traffic well.
, in particular, was taking lumps on a
downgrade to long-term attractive from buy. It was lately off 13.9%.
Some secondary indices were faring better, with the
Dow Jones Transportation Average
up 2% and the
Dow Jones Utilities Average
In the near-silent bond market, the benchmark 30-year Treasury was up 12/32 to 95 20/32, its yield easing to 6.46%. (For more on the fixed-income market, see today's early
Like utilities, financials were strong with the good fixed-income underpinning. The
Philadelphia Stock Exchange/KBW Bank Index
was up 0.7% and the
American Stock Exchange Broker/Dealer Index
was up 1.5%.
Breadth was poor on healthy volume.
New York Stock Exchange:
1,294 advancers, 1,685 decliners, 394 million shares. 72 new 52-week highs, 227 new lows.
Nasdaq Stock Market:
1,527 advancers, 2,480 decliners, 659 million shares. 170 new highs, 105 new lows.
Monday's Midday Watchlist
Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified.
Mergers, acquisitions and joint ventures
was falling 15/16 to 38 5/16 after said its board had turned down
International Specialty Products'
$45-a-share offer made on Dec.14. Dexter said that the bid was too low and not in shareholders' best interest. Shares of International Specialty Products were edging up 5/16 to 7 3/4.
was bouncing 2 3/4, or 61.3%, to 7 1/4 after it said it has licensed rights to its experimental panic disorder drug
. The deal calls for Warner-Lambert to pay Interneuron $73.75 million up front and manage all further testing, production and marketing for the drug. Shares of Warner Lambert were climbing 1 to 86 1/8.
was gaining 3 1/16, or 10.7%, to 31 7/16 after it said it has entered a $217.5 million deal to acquire all of the assets of
High Performance Plastics
. Shares of Uniroyal were tacking on 3 1/16, or 15.5%, to 22 13/16.
Earnings/revenue reports and previews
was adding 1/8 to 11 11/16 after it said income from
, in which it has a 41% interest, will be sliced by $39 million in the fourth quarter as a result of a $95 million pretax charge taken by Equistar.
each have a 29.5% interest in Equistar. Shares of Millennium Chemicals were tacking on 5/16 to 18 7/8 and Occidental Petroleum was advancing 1/16 to 21 11/16.
Robertson Stephens started coverage of
with a buy rating. Shares of Digimarc were unchanged at 51.
Robertson Stephens lowered its rating on eToys to long-term attractive from buy. Shares of eToys were down 4 1/4, or 13.9%, to 26 3/4.
Credit Suisse First Boston
initiated coverage of
with a strong buy rating. Shares of Retek were bouncing 18, or 32.8%, to 72 7/16.
Morgan Stanley Dean Witter
upped its rating on
to outperform from neutral and set a price target of 57. Shares of Seagate were rising 1 11/16 to 48 3/8.
sliced its fiscal 2000 earnings estimate for
to $3.28 a share from $3.43. Shares of Zions were sliding 6 1/2, or 9.7%, to 60 1/4.
Thursday began a legal challenge to the
Federal Communications Commission's
to offer long-distance phone service in New York. Shares of AT&T were losing 1 1/16 to 51 9/16, while Bell Atlantic was skidding 2 3/4 to 61 3/16.
was off 400 to 53600 after it said
donated 2,500 Class A shares to charity.
is preparing to launch a Web site called
, which will match up buyers and sellers of goods,
The Wall Street Journal
reported. Shares of priceline.com were lifting 3/8 to 55 1/2.
Prison Realty Trust's
board said an investor group will purchase $315 million in securities and commit to purchase an additional $35 million in securities in a newly formed company that would be created via the merger of Prison Realty and the companies operating under the name
Corrections Corp. of America
Shares of Prison Realty were stumbling 9/16, or 9.7%, to 5 3/16.
joint newsroom covered the Prison Realty news in a