(Updated from 9:24 a.m.)
After Friday's gory selloff, the brave and the bullish were scraping the blue-chip
Dow off the floor this morning. But tech stocks were having a tough time getting unstuck.
Nasdaq was lately bobbing below the flatline, trading down 17 to 2408. And the
S&P 500 was fractionally higher to 1302. The Dow was up 88 to 10,888.
So far this morning, the big news is good news. Retail giant
beat lowered earnings estimates by a penny when it said it made 45 cents a share. And home-improvement leader
met also lowered earnings estimates with results of 20 cents a share. Both companies are members of the
Dow Jones Industrial Average.
wrote separate stories on
Home Depot's earnings.
Home Depot was gaining 5.8% and Wal-Mart was up 3.4%, pushing retailers higher.
Some negative comments from
this morning on tech-gear makers didn't seem to be doing much damage to investor sentiment. But maybe that's because most of it has been heard before. Lehman this morning reduced its estimates on communications-equipment maker
, echoing recent calls by
Credit Suisse First Boston
. Lehman also cut estimates on communications-equipment maker
, and on chipmaker
Applied Micro Circuits
because of concerns about the optical slowdown. It also had negative views about
Still, many traders seem to think any move up today is just a short-term counteraction to Friday. Stocks spiraled lower at the end of last week on the heels of a bunch of warnings about
earnings weakness in coming quarters from major tech companies, including
. These stocks are former market darlings, so their bad news stung. They are lower again this morning. Plus, some economic data out last week raised the specter of troublesome inflation.
The market may want a rally, but most folks don't think it will see anything lasting until there's some real improvement in both corporate earnings and the economy -- or at least until the fog lifts and
visibility improves. A bunch of Wall Street's high-tech corporate hot-shots have recently said their crystal balls are getting awfully murky, and they no longer have a clear sense of their future business performance.
So watch for any errant earnings warnings. As the fourth-quarter earnings season winds to a close, companies and investors are looking ahead to first-quarter earnings. A report that came out on Friday from earnings tracker
First Call/Thomson Financial's
Joseph Kalinowski suggested that the unofficial earnings warning season may get off to an early start for the first quarter.
Fourth-quarter earnings season was a real doozy. As the economy slowed, consumer spending and corporate investment have plunged, inventories have ballooned and corporate profits have been squeezed. Plenty of companies even missed already lowered targets for the quarter. Most analysts expect earnings to get worse before they get better, but the question now is how much worse can they get?
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Treasury prices were falling again this morning after slipping for four successive days, as the money market has been trimming its hopes for an aggressive interest-rate cut next month. The decrease in value was steepest at the long end last week, with the 30-year bond finishing two-thirds of a point lower.
This morning, the benchmark 10-year
Treasury note was down 9/32 to 98 27/32, yielding 5.149%.
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European markets were mixed at their midday. Markets in France and Germany were grinding higher on strength in tech and telecoms -- and in anticipation of an up open on the Nasdaq this morning. Drug companies and banking stocks were lower. Germany's
was up 46.62 to 6518.83, while Paris'
gained 30.16 to 5614.91.
But London had lost its footing and slipped into the red, with the
off 15.40 to 6078.60.
The euro was lately trading at $0.9071.
In a rare turn of events, Tokyo's markets were up overnight. The beleaguered
took home winnings of 28.8 to 13,248.4 after traders shrugged off an unfortunate earnings forecast from
. Chipmakers, which have been destroyed in recent weeks, managed to actually make some gains, something that many said was a sign of a tech bottom. Then again, American markets took a day off Monday and hopeful traders operated without the specter of another American selloff on the horizon. Hong Kong's
gained 36.4 to 15,527.4.
The dollar was trading at 115.41 yen.
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