There Must Be a Storm Coming, 'Cause We Know We've Had the Calm

Looking at today's listless trading, market mavens see continued tech strength ready to be unleashed.
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SAN FRANCISCO -- For all the complaints registered about the head-spinning volatility in recent weeks, at least nobody was lacking for trades to make or theories to describe the action. Today was quite the opposite, as few were complaining but nobody was terribly excited, either.

One sub-theme that emerged in a fairly dreary session was that anyone betting leadership has reverted back to the so-called value stocks and away from technology got a comeuppance.

"We had a nice rally in nontech names but I don't believe that's sustainable," said Philip Tasho, CEO of

Riggs Investment Management

in Washington. "I think tech will continue to do well because it so dominates everything that's going on."

Many market players reflected that sentiment today as large-cap tech proved one of the few areas of strength despite a big hit to the erstwhile market-cap champion.

Microsoft

(MSFT) - Get Report

may have lost the top market-cap spot to

Cisco

(CSCO) - Get Report

last week, but the software giant still has a big sway over major averages. Thus, the resilience of tech proxies was even more impressive as the software giant fell 7% as investors expressed disappointment the company did not reach a settlement with the

Justice Department

over the weekend.

Restrained by the Redmond Menace, the

Nasdaq Composite Index

closed off 4.90, or 0.1%, to 4958.13 after trading as high as 5022.23. But evoking the overall strength of tech bellwethers, the

Nasdaq 100

rose 0.3%, the

Philadelphia Stock Exchange Semiconductor Index

climbed 1.4% and

Morgan Stanley High-Tech 35

gained 1.1%.

However,

TheStreet.com Internet Sector

index fell 11.56, or 0.9%, to 1260.97 after trading as high as 1290.26.

The Comp was sustained by strength in market-cap leader Cisco, chip giant

Intel

(INTC) - Get Report

and other tech favorites, such as

Sun Microsystems

(SUNW) - Get Report

and

Yahoo!

(YHOO)

.

Among tech names in the news, Internet client/server technology company

Spyglass

(SPYG) - Get Report

leapt 17.9% after receiving a $2.5 billion buyout offer from interactive television outfit

OpenTV

(OPTV)

, which fell 22.9%.

IBM

(IBM) - Get Report

rose 4.9% and

Qwest Communications

(Q)

climbed 9% after the two firms

agreed to a $5 billion business-to-business Internet venture.

Finally,

Unisys

(UIS) - Get Report

jumped 10.1% in heavy trading amid speculation it could be a takeover target.

Among other Big Board-traded tech giants,

Hewlett-Packard

(HWP)

,

America Online

(AOL)

and

Nokia

(NOK) - Get Report

were standouts on the upside.

Meanwhile, the

Dow Jones Industrial Average

fell 86.87, or 0.8%, to 11,025.85 thanks largely to losses in Microsoft, as well as financial components

American Express

(AXP) - Get Report

and

J.P. Morgan

(JPM) - Get Report

.

Financial stocks in general tumbled from big gains posted last week. The

Philadelphia Stock Exchange/KBW Bank Index

fell 1% while the

American Stock Exchange Broker/Dealer Index

slid 4.2%.

Finova Group

(FNV) - Get Report

tumbled 37.6% after

warning its first-quarter earnings will not meet expectations.

Whipsawed between strength in bellwether tech names and weakness almost everywhere else, the

S&P 500

fell from its recent record-setting pace, closing down 3.65, or 0.2%, to 1523.81.

The

Russell 2000

slid 0.36, or 0.1%, to 573.65 amid negative breadth but relatively light trading volumes.

In

New York Stock Exchange

trading, 881.2 million shares were exchanged while declining stocks led advancers 1,681 to 1,288. In

Nasdaq Stock Market

action 1.36 billion shares traded while losers led 2,316 to 1,887. New 52-week highs bested new lows 90 to 49 on the Big Board and by 113 to 69 in over-the-counter trading.

The Waiting Game

Given the big moves registered last week, few market players were surprised, or terribly disappointed, by today's setback

"Quiet, sloppy action is the only way to describe today's trade," said Bryan Piskorowski, market analyst at

Prudential Securities

. "It's just backing and filling. A little bit of consolidation after the run is not too surprising."

A "news vacuum" served as a restraining factor today, Piskorowski also observed. "We've got nothing to work with."

Issues on the market's wait list include an actual settlement or decision in Microsoft case and final decision on production increases from

OPEC

. Energy stocks were mixed today after OPEC officials suggested they would increase production, but not by enough believed necessary to significantly reduce the price of crude.

Also, there is little significant economic data on the calendar until the March payroll figures are announced April 7, the analyst said.

There is a pleasant aspect to the silence. Piskorowski noted the absence of preannouncements from major technology firms, despite various rumors last week about warnings from companies such as

Compaq

(CPQ)

and

Lucent

(LU)

.

"That's leading people in a more positive direction coming into earnings" and was a reason for technology's relative strength today, he said. "Tech remains the place we want to stay invested."

The price of the 10-year Treasury note rose 2/32 to 102 9/32, its yield dipping to 6.19%.

Among other indices, the

Dow Jones Transportation Average

fell 20.34, or 0.8%, to 2667.81; the

Dow Jones Utility Average

rose 3.43, or 1.2%, to 290.70; and the

American Stock Exchange Composite Index

fell 8.64, or 0.8%, to 1023.87.

For coverage of today's top stocks in the news, see the Company Report, published separately

.