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Publish date:

Wednesday, August 4, 1999

Nasdaq closes 11.3% off its all-time high; Nortel will outsource part of its communications gear manufacturing to five companies.

Markets

Stocks stand corrected.

The stock market swooned again on another day of sharply negative breadth, with proxies led to the downside by the

Nasdaq Composite Index

. The Comp entered bona fide correction territory today with the loss of another 48.06 to 2539.93, 11.3% off the all-time high of 2864.40 it set on July 16.

The other indices suffered, too. The

S&P 500

shed 16.85 to 1305.33; the small-cap

Russell 2000

dumped 6.59 to 429.69; and

TheStreet.com Internet Sector

index plummeted 29.16.

The

Dow Jones Industrial Average

lost a scant 2.54 to 10,674.77, despite getting 53.82 points of support from acquisition target

Union Carbide

(UK)

TheStreet Recommends

..

The 30-year bond was rallying on news that the

Treasury Department

scrapped its planned sale of long bonds in November. The Treasury also said it aims to begin a debt buyback by Jan. 1. The prospect of shrinking supply had lately sent the 30-year bond up 17/32 to 88 6/32, its yield falling to 6.121%.

The big European indices finished mixed, as France's

CAC

and the London

FTSE

both closed in the red while Germany's

Xetra Dax

ended modestly higher.

Asian markets went both ways overnight, as Hong Kong's

Hang Seng

closed up 117.18 to 13,591.02, while Tokyo's

Nikkei

dropped 284.55, or 1.6%, to 17,685.38.

More markets news and commentary are available in

TSC's

Markets section.

Companies

Allegiance Telecom

(ALGX)

said that

Vulcan Ventures

, the umbrella firm of

Microsoft

(MSFT) - Get Microsoft Corporation Report

co-founder Paul Allen, will buy 1.5 million shares of Allegiance common stock from its existing private equity investors at $50 a share.

DaimlerChrysler

(DCX)

said it plans to cut its management board to 10 to 13 members from the 17 now sitting on it. The company didn't set a date for the reduction.

Dow Chemical

(DOW) - Get Dow, Inc. Report

set plans to buy Dow (Jones Industrial Average, that is) component Union Carbide for $9.3 billion in stock. Union Carbide stockholders, who will get 0.537 Dow shares for each share of Union Carbide, will hold a 25% stake in Dow after the deal.

Health Care Property Investors

(HCP) - Get HCP, Inc. Report

is buying fellow health-care real estate investment trust

American Health Properties

(AHE)

for about $700 million in stock.

Nortel Networks

(NT)

set plans to outsource parts of its communications gear manufacturing to five companies, including

SCI Systems

(SCI) - Get Service Corporation International Report

,

C-MAC Industries

,

Sanmina

(SANM) - Get Sanmina Corporation Report

,

Communications Test Design

and

United Tri-Tech

. Nortel said it will immediately receive about $400 from plant sales, and save $250 to $300 million each year once the reorganization is complete.

More news on companies and stocks are available in

TSC's

Stock News section.

Tech

America Online

(AOL)

signed a 5 1/2-year, $100 million deal with

American Greetings

(AM) - Get Antero Midstream Corp. Report

to provide online greeting cards on AOL Web sites. The new deal is an expansion of a previous three-year, $10 million alliance between the two companies.

ADRs of Internet service provider

Internet Initiative of Japan

(IIJI:Nasdaq ADR) gained 8 5/16, or 36.1%, 31 5/16 in their trading debut.

Goldman Sachs

had priced the offering at $23 apiece, above the expected pricing range of $18 to $20 an ADR.

theglobe.com

(TGLO)

last night posted a second-quarter loss of 27 cents a share, narrower than the three-analyst

First Call

prediction of a 32-cent loss and better than the previous year's negative $1.65 a share.

AT&T

(T) - Get AT&T Inc. Report

agreed to provide Internet access for users of

Sega Enterprises'

Dreamcast game console. Sega said that Dreamcast customers will be able to choose either 150 hours of monthly access for $19.95 a month, or unlimited access for $21.95 a month.

More tech news and commentary are available in

TSC's

Tech Stocks section.

General News

NATO

ambassadors today agreed to make British Defense Secretary

George Robertson

the alliance's next secretary-general, according to several wire reports citing diplomatic sources.

U.S. war planes bombed four Iraqi antiaircraft artillery sites after coming under fire in the northern no-fly zone, the U.S. European Command said.

The death toll from Monday's head-on collision of two trains in India has climbed to 278. Workers are still sorting through the tangled wreck.

International

U.K. cable company

Telewest Communications

(TWSTY)

is set to unveil a high-speed Internet service along with major shareholder Microsoft, the

Financial Times

reported.

More international news and commentary are available in

TSC's

International section.

Elsewhere

Talk about lifestyles. Professional sycophant

Robin Leach

has been banned from Las Vegas'

Delmonico Steakhouse

after an incident in which he allegedly engaged in "lewd conduct" at a party in a private room of the casino restaurant. Witnesses claim to have spied Leach gamboling with several naked women through the glass windows that enclose the room in which the party was held. Leach said the incident was nothing more than "a harmless fun whipped-cream fight that lasted less than two minutes when dessert was served."