SAN FRANCISCO -- Like an arm-wrestling match between a moray eel and a rattlesnake, today's market action settled nothing.
Yes, major market proxies were mostly higher as bellwether tech stocks recovered from
yesterday's shellacking, inspired partially by better-than-expected earnings from
, which rose 3.4%. But the most public face of equities retreated, market internals again favored losers, and there were individual names damaged by earnings warnings. Examples of the latter include
, which fell 17.2%, and
, off 10.5%.
Action in the fixed-income and currency markets was again the dominant focus for equity traders. The dollar slid to 104.04 yen from 104.76 late yesterday, while the price of the 30-year Treasury bond dipped 2/32 to 100 13/32, its yield at 6.10%.
"The key thing is the bond and the dollar and the bond looks like it's holding up," said one New York-based equity trader, boldly suggesting 6.13% is a "resistance" level for the long bond. "Bonds are holding their own, hopefully they'll bounce."
Despite general optimism about both bonds and stocks, the trader admitted it was "tough" to get a handle on the action today. "The market looks like it wants to sell off, then it looks like they want to jam 'em up into quarter-end," he said. "Nobody is jamming in on the buy side, they're all a little afraid, but they're also not selling off hard. I'd buy 'em on the dips."
Dow Jones Industrial Average
took another dip today, falling 74.40, or 0.7%, to 10,524.07 after trading at low as 10,493.99. Weakness in
was most damaging to the index. Goodyear, which fell 8.9% yesterday after
cut its earning estimates, lost another 4.1% today. Union Carbide, meanwhile, fell 3.9% after calling a meeting of its shareholders for Dec. 1 to vote on its pending merger with
, which lost 3.5%.
fell 2.8% after the
filed a civil lawsuit against major tobacco companies. Elsewhere,
fell 4.2% and
British American Tobacco
rose 2.93, or 0.2%, to 1310.51 while the
Nasdaq Composite Index
gained 37.07, or 1.3%, to 2858.17. Both proxies got a boost from big-cap tech stocks such as
, which helped the
rise 1.6%. The S&P got an additional boost from modest strength in energy stocks, brokerages, and retailers. The Comp got a fuel-injected lift from bellwether Internet names, which soared in near unanimity.
TheStreet.com Internet Sector
index rose 32.94, or 5.3%, to 650.68, thanks to impressive gains by favorites such as
(also an S&P 500 component),
Outside the DOT,
leapt 7.3% after announcing plans to extend its service into grocery stores.
The enthusiasm for Net and related names was further evinced in the performance of IPOs
, up 243%;
(EPNY:Nasdaq), up 183%; and
(BBSW:Nasdaq), higher by 93.8%.
rose 1.03, or 0.2%, to 427.53, its rise hampered by negative market internals.
New York Stock Exchange
trading today, 822.2 million shares were exchanged while declining stocks led advancers 1,723 to 1,216. In
Nasdaq Stock Market
action 1.04 billion shares traded while losers led 1,914 to 1,881. New 52-week lows bested new highs 249 to 23 on the Big Board and by 116 to 63 in over-the-counter trading.
The divergence between the Dow and Nasdaq, along with the expanding ranks of stocks at 52-week lows, were another in a string of events that have even veteran market players perplexed.
"The last couple of days have been very confusing," confessed Randy Billhardt, co-head of block trading at
. "We're seeing tremendous volatility on relatively light volume. Today's volume does not suggest a tremendous trend" (notwithstanding repeated attempts by
Bob Pisani to characterize the session as being heavily traded).
"If you price merchandise correctly there are buyers, but they're not actively participating," Billhardt continued. "It's more a buyers' boycott unless there's specific news on a stocks. News that is stock specific can either elevate it tremendously, such as 3Com, or hit it dramatically, like
yesterday. There is no in-between."
The environment is likely to remain intact for some time, he continued. "As we get closer to earnings, with more possibility of warnings, people would rather not be a hero and will keep powder dry waiting for a buying opportunity," the trader said. "We're getting closer to those levels but unless I see volume pick up or a significant trend, it's very trendless."
Amid concerns about additional
tightening, fears of Y2K -- legitimate or not -- and a sense the market remains at "relatively lofty levels" despite its recent setbacks, "earnings are going to be crucial," Billhardt said. "The market is not cheap. What we need to maintain the levels we're at is to see positive earnings."
Until solid earnings reports are released
, the "cautionary, volatile trading" is likely to continue, he said. But despite those short-term reservations, the trader remains "fundamentally rather positive" about earnings and the economy.
Among other indices, the
Dow Jones Transportation Average
fell 11.36, or 0.4%, to 2926.28; the
Dow Jones Utility Average
dipped 1.76, or 0.6%, to 300.48; and the
American Stock Exchange Composite Index
fell 2.53, or 0.3%, to 782.45.
Elsewhere in North American equities, the
Toronto Stock Exchange 300
fell 31.57 to 6886.30 and the
Mexican Stock Exchange IPC Index
gained 71.97, or 1.5%, to 4991.76.
Wednesday's Company Report
Earnings estimates from First Call/Thomson Financial; new highs and lows on a closing basis unless otherwise specified. Earnings reported on a diluted basis unless otherwise specified.
Tobacco companies felt like the school bully had picked on them today. So they got together and elected tough guy Philip Morris to cross the playground and tell the Justice Department that they're not afraid of its big bad lawsuit. That didn't stop tobacco stocks from looking a little bruised. Shares of Philip Morris fell 1 1/8 to 34 1/2 , R.J. Reynolds slipped 1 3/16 to 27 5/16, and
, which operates
, lost 1 15/16 to 71 11/16.
Meanwhile, several technology IPOs were busy partying like rock stars. Broadbase Software shot up 13 1/8, or 93.8%, to 27 1/4, after being priced at $14.
Holders of E.piphany were having a vision as the shares rose 29 5/16, or 183%, to 45 3/16 after
Credit Suisse First Boston
priced shares at $16 each.
Kana Communications rocketed 36 7/16, or 242.9%, to 51 1/2 after being priced at $15.
Mergers, acquisitions and joint ventures
slipped 7/8 to 17 1/2 after it said that it upped the number of shares that
stockholders would receive in their planned merger. The share increase boosts AK Steel's stock value to $7.50 per share of Armco. Armco climbed 5/8, or 10.6%, to 6 1/2.
Cisco added 1 1/16 to 72 1/4 after it said that it has inked an agreement to purchase privately held Internet software maker
in a stock deal valued at $325 million.
lost 1/2 to 30 13/16 after it announced its plans to acquire
in a deal valued at $153 million. Pacific jumped 4 5/16, or 20.9%, to 25.
was unchanged at 39 1/2 after it said its Energy Services division forged a $1 billion deal with
to supply energy to 20 fiberglass production facilities. Owens Corning lost 1/4 to 23 15/16.
gained 7 1/4, or 7.1%, to 109 1/4 after it said it forged a $440 million stock deal to acquire
in an effort to boost its cancer-drug product line. According to the terms, MedImmune would exchange 0.15 of a share for each share of U.S. Bioscience's 29.8 million outstanding shares. U.S. Biosciences advanced 2 5/8, or 22.8%, to 14 1/8.
added 9/16 to 42 9/16 after it announced its plans to acquire
Color Printing and Imaging Division for $950 million.
downgraded shares of Tektronix to a buy from a neutral. Despite the downgrade, Tektronix was climbed 1 5/16 to 36 3/16.
Earnings/revenue reports and previews
added 3 3/8, or 6.4%, to 56 1/16 after it reported first-quarter earnings of 38 cents a share, in line with the 11-analyst estimate and up from the year-ago 33 cents.
Claire's Stores lost 1 7/8, or 10.5%, to 15 15/16 after it warned third quarter profits would miss analyst estimates due to a shortfall in sales. The eight-analyst estimate calls for earnings of 31 cents a share
added 3/4 to 40 after it reported first-quarter earnings of 70 cents a share, beating both the 10-analyst estimate of 63 cents and the year-ago 52 cents.
Morgan Stanley Dean Witter
edged up 3/4 to 89 9/16 after reporting third-quarter earnings of $1.65 a share, beating both the 14-analyst estimate of $1.63 and the year-ago $1.01.
National Discount Brokers
added 3/16 to 26 15/16 after it reported first-quarter earnings of 2 cents a share, beating the two-analyst estimate of break-even results and the year-ago loss of 4 cents.
National Service Industry
lost 3/8 to 31 posted fourth-quarter earnings of $1.07 a share, beating the four-analyst estimate of 83 cents and the year-ago 72 cents.
added 1/8 to 9 1/4 after it posted third-quarter earnings of 23 cents a share, beating the four-analyst estimate of 22 cents and the year-ago 17 cents.
3Com added 15/16 to 28 5/8 after
last night posting first-quarter earnings of 33 cents a share, well ahead of the 26-analyst estimate of 24 cents and above the year-ago 24 cents.
inched up 7/16 to 14 3/4 after it posted first-quarter earnings of 27 cents a share, beating the five-analyst estimate of 22 cents and the year-ago 9 cents.
Offerings and stock actions
slipped 1/8 to 89 3/4 after it boosted its share buyback authorization by $2 billion. Since the start of the year, Cigna has repurchased 17.1 million shares for $1.5 billion.
Merrill Lynch analyst Candace Browning slashed her estimates on a host of airline stocks, citing Hurricane Floyd and slow revenues. September quarter and fiscal 1999 earnings estimates on
were sliced to $1.70 from $2 and $4.50 from $4.80, respectively, while
were cut to $1.45 from $1.70 and $4.90 from $5.40, respectively.
September quarter and fiscal 1999 earnings estimates were lowered to $1.90 from $2.10 and $6.65 from $6.75 respectively, while
estimates for the same periods were cut to a loss of 50 cents a share from a 20 cent-loss and to a profit of $1.85 per share from a $2.30.
Browning also sliced her fiscal 1999 estimate on
to $3.30 from $3.45 and lowered both full-year and Sept-quarter estimates on
to $9.60 from $10 and $3.60 from $3.75 respectively.
AMR lost 1/8 to 54 5/8, while Delta fell 1 5/16 to 47 7/16. US Airways climbed 1 5/16, or 5.3%, to 25 7/8 and Northwest added 5/16 to 24 1/2, while United was slipped 1/8 to 66 3/8.
Merrill Lynch started coverage of
with intermediate accumulate, long-term buy ratings and
with intermediate and long-term accumulate ratings. Shares of Amtel climbed 1 1/2 to 38 5/8 while Microchip gained 2 3/8 to 58 1/2.
Credit Suisse First Boston upped its rating on
to a buy from a hold. Shares of Apache rose 1 1/2 to 41 1/2.
Deutsche Banc Alex. Brown
cut its rating on
to market perform from buy. B/E Aerospace fell 2 1/2, or 16.9%, to 12 3/8.
began coverage of
with a buy rating. Blockbuster added 3/4, or 5.7%, to 13 1/16
Deutsche Banc Alex. Brown upgraded shares of
to a strong buy from a buy. Broadcom jumped 10 1/16, or 9.7%, to 114 1/4.
to attractive from neutral. Chevron slipped 1/8 to 89 5/8.
slipped 1/4 to 32 3/4 after
Warburg Dillon Read
slashed its rating to hold from strong buy, citing U.S. domestic growth rates of Frito-Lay and, to a lesser extent, Pepsi.
Goldman Sachs added
to its recommended list. Shares of Eli Lilly rose 1 1/16 to 66 11/16, while Merck tacked on 1 1/8, to 69 7/8.
hammered its rating on
to neutral from strong buy. Shares of Maxwell shed 6 11/16, or 34.5%, to 12 11/16, a record low for the year.
Goldman Sachs began coverage of
Pharmacia & Upjohn
American Home Products
with market outperformer ratings. Pfizer added 13/16 to 36 7/8 and Pharmacia & Upjohn shares climbed 1 to 48 3/4, while AHP lost 7/16 to 44 7/8.
Goldman Sachs initiated coverage of
with market performer ratings. Schering-Plough was lost 1 15/16 to 48, while Bristol Myers shares fell 1/2 to 71 7/16.
Goldman Sachs sliced its rating on
Sinclair Broadcast Group
to market performer from its recommended list. Merrill Lynch and Morgan Stanley have also downgraded the stock. Shares of Sinclair shed 4 7/16, or 29.8%, to 10 1/2.
fell 2 1/4 to 58 5/8 after
Brown Brothers Harriman
raised its short-term rating to buy from neutral and its price target to 78.
climbed 3 3/4, or 6%, to 66 after the company said it plans to sell downloadable music over the Internet.
, has been going bonkers, rising jumping 17 11/16, or 14.6%, to a record 139, amid general fervor about business-to-business e-commerce stocks. The stock spiked up yesterday following an announcement of a vague deal with a European division of Sony.
Probably less influential was a press release today from BroadVision entitled "BroadVision's Pehog Chen Named 'Master of the Universe' by Business Week Magazine."
have chosen Scott Flanders as to act as chairman and CEO after their planned merger is completed. The merger is a joint venture between
which slipped 1/2 to 156 7/8, and
which lost 7/16 to 62 13/16 .
Financial services firm
fell 2 3/16, or 5.3%, to 39 3/8 after the company said the loss ratio in its medical reinsurance business jumped to 94% in July and August from 71.7% in the second quarter.
The NYSE said a regular seat on the exchange sold for $2.55 million, $100,000 under the record $2.65 million paid in August. The sale marked the second since the Big Board announced plans for an IPO.
climbed 1 1/2 after it upped its bid for
Cyprus Amax Minerals
to nearly $2.8 billion in cash and stock, confirming a report in
The Wall Street Journal
. Shares of Cyprus climbed 1 9/16, or 9.1%, to a 1999 high of 18 13/16, after it said its advisors and board would review the new offer. Asarco climbed 2 1/16, or 10.1%, to 22 1/2.