(Updated from 4:01 p.m.)
After a roller coaster ride on the stock market this afternoon, the major indices finished mixed. In late day trading, the
Dow Jones Industrial Average flipped above and below 9500, but closed up 30 to 9515. The
Nasdaq Composite Index was stuck below the 1650 watermark, ending down 34 to 1639.
Despite today's gains on the Dow, most Wall Street pros agree that until the earnings picture brightens, the stock market outlook will darken. Furthermore, experts were skeptical of today's advance on the blue-chip index, as buying is typically met with selling in a bear market environment.
On the heels of yesterday's major selloff, traders said that investors lacked conviction about today's market. "People are figuring out how to rotate in and out of stocks," said Jim Volk, co-director of institutional trading at
earlier in the day. "The markets aren't in disarray today, but they're going down."
Trading volume was light this afternoon, as apparently many investors decided to sit this session out. According to Volk, much of today's movement was the result of program trading, or computer-driven buying and selling of groups of stocks by institutions.
"It's nothing but a trading turn," said Todd Clark, head of listed trading at
earlier this afternoon. "The market is very quiet, which doesn't bode well for this bounce." Clark further attributed today's gains to short covering, meaning the accelerated buying of stocks that had been shorted by investors.
Looking at the sectors swinging today, the
Philadelphia Stock Exchange Semiconductor Index
closed down 5.5%, after trading up at one point this afternoon. Earlier today, the
Semiconductor Industry Association
reported that chip sales in February declined 6.9% from January. Over the past few weeks, the chip sector has been hit hard amidst an uncertain earnings outlook. Shares of
, a bellwether for the industry, closed off 9.5% to $22.63.
More bad news about earnings hit the market after the closing bell yesterday. The latest round of pre-announcements was centered on the software sector, where some Wall Street experts see room for stock prices to fall further. But on the heels of yesterday's carnage that hit both software and non-software names, the culprits were trading off of their Tuesday lows.
Among the companies to warn on Tuesday night, electronic commerce software manufacturer
, soared 7% to $6,
gained 3.6% to $14.44 and
traded higher by 5.8% to $13.69.
In a speech before the Senate Finance Committee this morning,
Federal Reserve chairman
Alan Greenspan said that the slowing U.S. economy poses a risk to free trade.
Elsewhere in the tech sector, shares of
bounced back from steep losses this morning, after the telecommunications company said that bankruptcy rumors were "absolutely false." Down 23.2% at one point this morning, the one-time highflier closed behind 13.6% to $6.78.