Competition Causes No Problems for Network Solutions
SAN FRANCISCO -- Losses in Microsoft (MSFT) - Get Report following its earnings Tuesday were not enough to slow down the high-tech sector, which is making Monday's selloff seem as fluky as Cal Ripken being placed on the disabled list.
While Microsoft was able to best earnings estimates, its growth prospects for the rest of the year are hazy.
Prudential Securities
downgraded the stock to hold from accumulate on concerns of a Y2K-related slowdown. Microsoft closed down 1 1/8, or 1%, at 82, but it was in the minority of tech stocks today.
The big story again was Internet stocks. And few were bigger than
Network Solutions
(NSOL)
. On the day that the
Internet Corporation for Assigned Names and Numbers
, or ICANN, announced the five companies that would be allowed to register Internet domain names, including heavyweight
America Online
(AOL)
, Network Solutions staged a huge rally, closing up 32, or 53%, at 92.
It was a classic case of a short squeeze after the stock was hammered over the past week in advance of the news. Though AOL is expected to provide strong competition, the registration price of $9 was higher than some were looking for, and Network Solutions is expected to remain the dominant player in the domain name business. Gains come ahead of its earnings report on Thursday.
The news also helped AOL, which closed up 11 3/16, or 9%, at 139 7/8.
Among the other big Internet winners was
CMGI
(CMGI)
. The company bounced back after dropping around 55 points in the previous two sessions, closing up 40 3/4, or 20%, at 246 3/4. CMGI's recovery was aided by gains in
Lycos
, of which CMGI owns a portion. Lycos closed up 27 5/8, or 37%, at 101 1/2 following a report from
Media Metrix
that the Lycos Network attracted more visitors to its sites in March than
Yahoo!
(YHOO)
. Interestingly, on a day many other Net stocks surged, Yahoo! was up only 3 7/8, or 2%, at 147 7/8.
Also contributing to the strong gains in the Nasdaq was a surge in semiconductor equipment stocks. The sector benefited from a report from the
Semiconductor Equipment and Materials International
that showed strong orders for chipmaking tools in March. Also, the book-to-bill ratio for the industry was at 1.30 in March versus 1.21 in February.
Novellus Systems
(NVLS)
closed up 9 5/8, or 20%, at 57 1/2.
Texas Instruments
(TXN) - Get Report
closed up 8 3/4, or 9%, at 108 3/4. Other big gainers included
Kulicke & Soffa
(KLIC) - Get Report
, up 4, or 18%, at 25 3/4; and
PRI Automation
(PRIA)
, up 4 1/4, or 16%, at 30 3/4.
After beating earnings estimates by 6 cents,
RF Micro Devices
(RFMD)
closed up 11 3/4, or 23%, at 63 5/8.
AT&T Deal
Thursday's edition of Japanese newspaper
Nihon Keizai
is reporting that
AT&T
(T) - Get Report
and
British Telecom
(BTY)
have reached an agreement with
Japan Telecom
to take a combined 30% stake in the Japan Railways telecommunications affiliate. The companies will team up to offer Internet and other data communication services to multinational corporations and neigboring Asian telecom markets, the paper writes. AT&T closed up 2, or 4%, at 57.
