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Stocks Close Lower Amid Tumble in Bond Market

The Nasdaq broke a five-day winning streak.

After rising for five consecutive sessions, the

Nasdaq Composite Index

took a breather today and tumbled, while the Treasury market slumped.

Most sector barometers were in the red by day's end. The utility sector was one of the few areas of the market that gained. The

Dow Jones Utility Average

advanced 0.5%.

The broadbased tumble in stocks was blamed in part on the weakness in the Treasury market and on the need for stocks to take a break after its recent upside sprint.

The

Dow Jones Industrial Average

was weighed down notably by its cyclical components. Intraday, the Dow had traded as low as 10,708.65 before coming off that level.

DuPont

(DD) - Get DuPont de Nemours, Inc. Report

was the biggest drag on the venerable index. DuPont was down 2 9/16 to 67 5/8.

TheStreet.com E-Finance Index

fell 2 3/16, or 2.6%, to 83 19/32. The index made its debut today on the

American Stock Exchange

. The index tracks the activities of online brokers, online banks and online-transaction companies. The ticker symbol is XEF. Options on the index will be available for trading later this summer on the Amex. Historical data indicate the index would have risen approximately 180% since the beginning of 1999.

On the

New York Stock Exchange

, decliners beat advancers 1,671 to 1,283 on 708.9 million shares. On the

Nasdaq Stock Market

, losers beat winners 2,254 to 1,625 on 989.5 million shares.

On the NYSE, 88 issues set new 52-week highs while 54 touched new lows. On the Nasdaq, 114 issues set new highs while new lows totaled 41.

On the Big Board,

Compaq

(CPQ)

was most active, with 28.8 million shares changing hands. It was up 1 1/2 to 23 5/8.

On the Nasdaq,

Cisco

(CSCO) - Get Cisco Systems, Inc. Report

was most active, with 33.8 million shares changing hands. It was down 2 1/16 to 59 1/2.

Market data above are preliminary. Updated numbers and analysis will follow in the Market Roundup

2:56 p.m.: S&P, Nasdaq Slip Back Into Negative Territory

After spending a little time above water, the

Nasdaq Composite Index

and the

S&P 500

decided to slip back underwater, where they've been most of the session, while the

Russell 2000

was still clinging to positive territory.

Meanwhile, the

Dow Jones Industrial Average

, which hasn't seen green all day, continued to be weighed down by its cyclical components. The Dow, however, is well off its session lows. Intraday, the Dow had traded as low as 10,713.72 before coming off that level.

DuPont

(DD) - Get DuPont de Nemours, Inc. Report

and

Alcoa

(AA) - Get Alcoa Corp. Report

were the biggest drag on the venerable index. DuPont was off 2 1/4 to 67 15/16, while Alcoa slumped 1 1/16 to 62 5/16.

The market continues to experience a little bit of a rotation back into tech names, said Jay Suskind, head of institutional equity trading at

Ryan Beck

, a shift that began last Wednesday in the wake of the release of the market-friendly May

Consumer Price Index

.

He said the bond market's weakness is tempering any move for stocks to the upside.

On the

New York Stock Exchange

, decliners were beating advancers 1,598 to 1,289 on 547 million shares. On the

Nasdaq Stock Market

, losers were beating winners 2,093 to 1,651 on 756 million shares.

On the NYSE, 82 issues had set new 52-week highs while 47 had touched new lows. On the Nasdaq, 102 issues had set new highs while new lows totaled 34.

On the Big Board,

Compaq

(CPQ)

was most active, with 24 million shares changing hands. It was up 1 11/16 to 23 3/4.

On the Nasdaq,

Cisco

(CSCO) - Get Cisco Systems, Inc. Report

was most active, with 26 million shares changing hands. It was down 5/8 to 60 15/16.

1:59 p.m.: Stocks Struggle Into Positive Territory

The

Nasdaq Composite Index

and

Russell 2000

have managed to climb out of negative territory; however cyclicals were continuing to keep the blue-chip

Dow Jones Industrial Average

underwater.

On the new issue front,

Ramp Networks

(RAMP:Nasdaq) was making a solid trading debut, and was up 4 11/16, or 43%, to 15 3/4.

However,

Salon.com

(SALN:Nasdaq) wasn't as fortunate. Salon.com's 2.5 million-share IPO was priced at $10.50 a share Monday after a Dutch auction. Salon.com was down 1/2 to 10. The offering was underwritten by

W.R. Hambrecht

and

Daiwa Securities America

via W.R. Hambrecht's proprietary "OpenIPO" system.

On the

New York Stock Exchange

, decliners were beating advancers 1,546 to 1,291 on 464 million shares. On the

Nasdaq Stock Market

, losers were beating winners 1,989 to 1,638 on 631 million shares.

On the NYSE, 73 issues had set new 52-week highs while 41 had touched new lows. On the Nasdaq, 88 issues had set new highs while new lows totaled 32.

On the Big Board,

Compaq

(CPQ)

was most active, with 21 million shares changing hands. It was up 1 15/16 to 24 1/16.

On the Nasdaq,

Cisco

(CSCO) - Get Cisco Systems, Inc. Report

was most active, with 21 million shares changing hands. It was up 1/2 to 62 1/16.

Sector Focus: Brokerages

After having a huge runup recently (in large part on expectations that they'll post strong earnings), brokerage stocks slumped.

Lehman Brothers

(LEH)

, which reported estimate-smashing numbers this morning, was down 2 7/16 to 57 7/8.

For its second quarter ended May 31, Lehman posted earnings of $2.09 a share, vastly outstripping the

First Call

11-analyst estimate of $1.68, but down from the year-ago $2.12.

Looking ahead,

Goldman Sachs

(GS) - Get Goldman Sachs Group, Inc. (GS) Report

is slated to report earnings tomorrow and

Morgan Stanley Dean Witter

(MWD)

is slated to report earnings Thursday. Goldman was down 1/2 to 69, while Morgan Stanley was off 2 13/16 to 96 15/16.

The

American Stock Exchange Broker/Dealer Index

was down 1%.

Bucking the trend among the index's components were

Hambrecht & Quist

(HQ)

, which was up 1 7/8, or 5%, to 36 7/16, and

E*Trade

(EGRP)

, which was up 1 7/8 to 42 1/2.

1:09 p.m.: Midday Musings: Quick Rise in Stocks Slows in Take-a-Break Sessiont

11:57 a.m.: Stocks Bounce From Session Lows

Going into midday, though their screens were still awash in red, traders could take comfort in knowing that a key support level for the market had held and stocks were coming off their lows.

Short-term players have been spending a lot of time looking at 1352 on the

TheStreet Recommends

S&P 500

futures -- a level that translates into around 1340 on the cash index. "A move below 1352 could carry very short-term significance," said Ricky Harrington, chief technical analyst at

Wachovia Securities

-- one that could lead to a retest of the recent lows.

This morning, the market hit that level -- twice -- then bounced higher. "I'm inclined to think the downside is going to be limited this week unless we get some news," said Harrington, who feels that end-of-quarter window dressing and the expectation of a good earnings season will do their magic.

But the upside looks limited, too, said Dan Mathisson, head stock trader at

D.E. Shaw Securities

. "Until this whole interest-rate issue is out in the open, I think people are still very concerned with what the bond market is doing," he said.

--

Justin Lahart

10:57 a.m.: Dow Down in Broad Slump as Treasuries Take Another Hit

Perhaps undone by too much of a good thing in recent days, major stock averages were on the down slope this morning, as were the majority of individual issues.

The Dow Jones Industrial Average was down 83 to 10733 and the

S&P 500

was off 8 to 1341. Proving the setback was an equal opportunity employer, the

Russell 2000

was down 2 to 448.

The Dow's decline was fairly broadbased sector-wise, with big negatives including

DuPont

(DD) - Get DuPont de Nemours, Inc. Report

,

Alcoa

(AA) - Get Alcoa Corp. Report

,

Sears

(S) - Get SENTINELONE, INC. Report

and

American Express

(AXP) - Get American Express Company Report

.

As was the case yesterday, the bond market failed to provide a supportive backdrop for stocks. The price of the 30-year Treasury bond was down 10/32 to 89 2/32, its yield rising to 6.05%.

The action in bonds help prevent much-better-than-expected earnings by

Lehman Brothers

(LEH)

from giving financials a lift. Lehman was down 4% while the

American Stock Exchange Broker/Dealer Index

was off 2% and the

Philadelphia Stock Exchange/KBW Bank Index

was down fractionally.

Retailers were also on the downside after

BTM/Schroder

reported chain store sales fell 0.2% for the week ended June 19 vs. the prior week. The

S&P Retailing Index

was off 1%.

In techland, better-than-expected quarterly results last night from

Cabletron Systems

(CS) - Get Credit Suisse Group AG Sponsored ADR Report

and

Micron Electronics

(MUEI)

failed to replenish the raging inferno that has been the sector in recent days. More than those (admittedly) second-tier names, traders were focused on

Donaldson Lufkin & Jenrette

cutting earning estimates for

Intel

(INTC) - Get Intel Corporation (INTC) Report

and the fact the

Nasdaq Composite Index

rose 9.7% from June 14 through

yesterday's close.

The tech-aligned index was lately down 22 to 2608.

Howerver, somebody apparently neglected to tell Internet favorites that the time to rally has passed.

TheStreet.com Internet Sector

index was off just 2 to 592 after rising as high as 599.78. DOT gainers were led by

MindSpring

(MSPG)

and

E*Trade Group

(EGRP)

.

Meanwhile,

TheStreet.com E-Finance Index

was off 1/4 to 85 1/16 as it makes its debut today on the

American Stock Exchange

. The index tracks the activities of online brokers, online banks, and online-transaction companies. Index quotes are available using the ticker symbol XEF. Options on the index will be available for trading later this summer on the Amex. Historical data indicate TheStreet.com E-Finance Index would have risen approximately 180% since the beginning of 1999.

In

New York Stock Exchange

trading, declining stocks were leading advancers 1,520 to 984 on 195 million shares. In

Nasdaq Stock Market

activity, losers were leading 1,739 to 1,234 on 271 million shares.

"It's a little on the sloppy side after being up the last four to five days," said Jim Benning, a trader at

BT Brokerage

. "The bond market is slip siding away. There's still a fear of higher rates and at some point it becomes a self-fulfilling prophecy."

Still, "it doesn't look too bad," the trader said. "I don't see any big selloff and some smaller tech stocks are doing OK."

--

Aaron Task

9:58 a.m.: Stocks Lower Amid Drop in Treasuries

Stocks were softer along with Treasuries early on as the government market was again being pressured in part by looming corporate supply.

In earnings news, after the close

Cabletron Systems

(CS) - Get Credit Suisse Group AG Sponsored ADR Report

and

Micron Electronics

(MUEI)

posted better-than-expected results.

This morning

Lehman Brothers

(LEH)

posted second-quarter earnings of $2.09 a share, crushing the

First Call

11-analyst outlook of $1.68 a share, but down from the year-ago $2.12.

In other news,

Donaldson Lufkin & Jenrette

lowered its fiscal 1999 and 2000 earnings estimates on

Intel

(INTC) - Get Intel Corporation (INTC) Report

to $2.20 from $2.27, and to $2.50 from $2.60, respectively. DLJ also lowered its price target on the chip giant to 70 from 75.

TheStreet.com

(TSCM)

, publisher of this Web site, and the

American Stock Exchange

announced the launch of

TheStreet.com E-Finance Index

. The index will track the activities of online brokers, online banks, and online-transaction companies. Quotes on the index will be available today using the ticker symbol "XEF." Options on the index will be available for trading later this summer on the Amex.

Most Up at Open -- NYSE

Shanghai Petrochemical (SHI) - Get Sinopec Shanghai Petrochemical Co. Ltd. Sponsored ADR Class H Report, up 2 11/16 to 23 3/4

.

Most Up at Open -- Nasdaq

priceline.com (PCLN) , up 2 3/4 to 109 1/16

.

Most Down at Open -- NYSE

Emerson Electric (EMR) - Get Emerson Electric Co. Report, down 1 13/16 to 66

.

Most Down at Open -- Nasdaq

Go2Net (GNET) , down 5 1/4 to 146 7/8

.

--

Brian Louis