After brushing off the concerns about Argentina and Latin America yesterday, the market decided it was time to think about it today as traders and investors dumped stocks.
While some may really be concerned about the situation, others seem to be using the news for profit-taking considering the way the market's run up lately.
The selling came right away in the market this morning. All of the major market barometers hit their session lows within a half hour of the opening bell before coming off those levels. Major gauges, however, late in the morning stocks took another downturn, but have since reversed course again.
Meanwhile, in new issues,
(CHINA:Nasdaq) was soaring in its trading debut, up 204.6%.
Yesterday, the Treasury market rallied in part thanks to flight-to-quality buying on worries over Argentina's ability to repay debts and on political problems there, to name just a couple of the jitters. Yesterday, Argentina's
index tumbled nearly 9%. It has begun to repair that damage, and was lately up 3.3%. Brazil's
index was down 1.2%, but off its lows.
Dow Jones Industrial Average
was down 60, or 0.5%, to 11,141.46.
was taking a hit, down 2 3/8 to 138 3/16, and was the biggest drag on the Dow. The second-biggest drag on the Dow came via
, which was off 2 3/16 to 96 3/4.
was down 8, or 0.6%, to 1391. The
Nasdaq Composite Index
was down 21, or 0.8%, to 2769.
In the Net arena,
TheStreet.com Internet Sector
index was down 9, or 1.4%, to 650.
was making a notable advance. It was up 3.8%.
Small-caps were also lower: The
was down 3, or 0.6%, to 457.
Bruce Bittles, market strategist at
in Nashville, Tenn., said back in early May that the market was going to move into a trading range of 10,300 to 11,100 on the Dow, with that trading range staying into effect to mid-to-late June, which was around the time the
was going to raise rates. Then, his call was for a big rally with the potential for the Dow to go to 11,600.
Going forward, Bittles said today, he's looking for a correction in the market from August to September and lasting through October.
Some market watchers and participants discounted the events in Latin America.
Bittles said overall he doesn't think the situation in Argentina will be a major influence on the market at all.
Among today's big movers,
was up 8.4% after a better-than-expected earnings report and news it is pushing up its rheumatoid arthritis drug,
Banks were suffering a bit of a thumping. The
Philadelphia Stock Exchange/KBW Bank Index
was down 1.3%.
Brokerage stocks were mostly softer. Two Wall Street brokerage giants --
-- posted earnings this morning and both beat estimates. Merrill was lately up modestly, while PaineWebber slipped a bit.
was down 0.8%. The
Philadelphia Stock Exchange Semiconductor Index
was down 0.5%. The
Morgan Stanley High-Tech 35
was off 0.7%.
Traders said many market participants are awaiting chip giant
earnings report, which is expected to be released after the close. Ahead of the report, Intel was off a hair.
, in a note, said it expects Intel's earnings will probably be in line. "The key with Intel is: 1) What sequential growth can they show, given Q2 is a seasonally strong? 2) Can they keep gross margins in the 59-60 range? 3) Are there any fears related to Y2K that could impact Q4?"
Scott Curtis, senior equity trader at
Brown Brothers Harriman
, said around midmorning it was "kind of quiet" and there wasn't much flow one way or another in the market.
In the Treasury market, the 30-year bond was lately up 1/32 to 90 28/32, yielding 5.91%. The long bond, however, is well off its best levels of the session. (For more on the fixed-income market, see today's early
A good thing for stocks is that the long bond is back under 6%, Curtis said.
reported that U.S. import prices fell 0.2% in June, after a revised jump of 0.8% in May. Meanwhile, export prices were unchanged in June after a revised rise of 0.1% in May.
Looking ahead on the economic front, market participants are also looking ahead to tomorrow's release of the
Producer Price Index
and the Thursday release of the
Consumer Price Index
New York Stock Exchange
, decliners were leading advancers 1,756 to 1,017 on 431 million shares. On the
Nasdaq Stock Market
, losers were beating winners 2,156 to 1,472 on 568 million shares.
On the NYSE, 41 issues had set new 52-week highs while 39 had touched new lows. On the Nasdaq, 91 issues had set new 52-week highs while new lows totaled 26.
On the Big Board,
Health Management Associates
was most active with 15.8 million shares changing hands. It was down 29.8% after issuing an earnings warning.
On the Nasdaq,
was most active with 15 million shares changing hands. It was down 1 3/8 to 42 1/4.
Meanwhile, among other indices, the
Dow Jones Transportation Average
was down 0.8%, the
Dow Jones Utility Average
was up 0.1% and the
American Stock Exchange Composite Index
was down 0.7%.
Tuesday's Midday Watchlist
As noted above, ISP China.com was rocketing skyward by 40 15/16, or 204.6%, to 60 3/16 after
priced its 4.2 million-share initial offering at $20. The offering's price range has been raised to $17 to $19 from $14 to $16.
wrote about the offering earlier this month.
Mergers, acquisitions and joint ventures
Air Products & Chemicals
was up 1/8 to 41 3/8 after saying it and
are jointly acquiring Britain's
for a total of about $11.2 billion in cash. BOC was off 5/8 to 41 15/16.
Online music retailer
was down 1 11/16, or 7.6%, to 20 1/2 on news it's merging with
, the club-based direct marketer of music and videos, which is owned equally by
. Sony and Time Warner each will have a 37% stake in the newly formed public company. CDnow's existing shareholders will own the remaining 26%. Sony was down 1/8 to 117 3/8; Time Warner was down 5/16 to 75 3/4.
Separately, CDnow said it expects its second-quarter loss to be narrower than the
six-analyst projection for a loss of 83 cents a share.
was up 1 3/8 to 95 3/8 after agreeing to buy
in a stock swap valued at $530 million. NetGravity was down 1 7/8, or 6.8%, to 25 5/8.
was down 1 7/8 to 49 11/16 after saying it's acquiring
, which was down 9/16 to 21 11/16. Excite@Home will issue about 8.3 million shares of stock, totaling about $425 million. It also will assume iMall's outstanding options and warrants.
Sunstone Hotel Investors
was up 9/16, or 6.3%, to 9 1/2 on word it's being acquired by
, an affiliate of
, and certain members of Sunstone's senior management for $10.35 a share in cash.
Earnings/revenue reports and previews
Amgen was up 5 9/16, or 8.4%, to 71 7/8 after last night reporting second-quarter earnings of 50 cents a share, topping the 23-analyst estimate of 46 cents and moving up from the year-ago 41 cents. The even better news for Amgen was that the company is pushing up its rheumatoid arthritis drug,
Food and Drug Administration
said it was OK to file based on the two Phase II trials the company did on the drug. Amgen won't have to conduct Phase III trials. It will file for approval of the drug by the end of the year, way ahead of schedule. Today,
Morgan Stanley Dean Witter
upped its 1999 earnings estimate for Amgen to $1.97 from $1.80 a share.
Salomon Smith Barney
lifted its one-year price target for the stock to 112.
was down 5 1/16, or 27%, to 13 3/4 after last night saying it expects to break even in its second quarter. The six-analyst view called for earnings of 12 cents vs. the year-earlier 6 cents. The company blamed severance costs for a former CFO for the expected shortfall.
was down 3 1/2, or 16.4%, to 17 7/8 after last night saying it sees second-quarter earnings coming in around 10 cents a share due to production realignment costs and promotional expenses at its
Mrs. Smith's Bakeries
business. The 10-analyst estimate called for a repeat of the year-ago 19 cents. Today,
Donaldson Lufkin & Jenrette
cut the stock to market perform from buy and Morgan Stanley Dean Witter lowered its 1999 earnings estimate for the company to 97 cents a share from $1.15.
Health Management Associates was down 3 3/8, or 29.8%, to 8 after warning it sees third-quarter earnings coming in even with the year-ago 15 cents a share. The 13-analyst estimate called for earnings of 18 cents. The company blamed lower-than-expected same-unit growth and timing of hospital acquisitions for the expected shortfall.
was down 10 5/16, or 38%, to 16 15/16 after last night saying it sees third-quarter earnings of 40 cents to 42 cents a share due to the cancellation of about $6.5 million in orders and the deferral of about $4.5 million in other orders. The single-analyst forecast called for earnings of 67 cents vs. the 40 cents made a year earlier.
was down 3 1/2 to 68 5/16, hit by a bout of profit-taking. Last night, the company announced third-quarter earnings of 24 cents a share, 1 cent ahead of the 13-analyst estimate and above the year-ago 18 cents.
In other earnings news:
Amazon.com was up 4 1/2 to 121 3/4 after launching two new stores -- one selling electronics, one selling games.