Let's see if we have this straight: Net stocks rallied Tuesday despite strong economic data, but today the sector was down, despite a friendly economic report?
Well, it's not quite that simple, though that was how it appeared today. After a quick start after a somewhat-benign
Consumer Price Index
report, Net stocks slipped along with the
. Disappointment with
earnings, along with a setback in Treasury prices due to dollar weakness, contributed to the setback. Oracle was off 3 1/16, or 7%, at 42 3/8 after meeting, but not exceeding, earnings
TheStreet.com Internet Sector
index was down 7.89, or 1.3%, at 617.67. The DOT reached a high of 635.52 early in the session before sliding back.
Jim Benning, stock trader with
, said the market has just had a negative tone lately, and traders are selling into any strength. He said there are still concerns that the
will raise interest rates when it meets in October, thus offsetting all three cuts in interest rates from last year.
"It seems every time there's a good piece of news, it's an opportunity to sell rather than buy, and any gains fade out as the day goes on," he said.
Benning said buying on dips remains "a valid strategy." He said the market is heading into a period when it typically does not do well, but once October is over, he expects a good flow of money to be put into the market as the end of the year draws closer.
Price action in the Net bellwethers told today's story well.
, which traded as high as 169 3/4, was recently trading down 1 5/8, or 1%, at 163 9/16.
was recently down 2 3/8, or 1.6%, at 152 5/8 after trading as high as 161.
Among stocks in the news,
was up 1 3/8, or 4%, at 37 3/8.
U.S. Bancorp Piper Jaffray
put out a note on the company, saying it is "becoming the 800-pound gorilla of the digital music industry" after the company signed agreements with
Warner Brothers Records
. It also has a deal with
was up 9 1/2, or 13%, at 80 1/2. The stock, which rallied sharply last week after
Credit Suisse First Boston
eliminated a price target for the business-to-business electronic commerce software maker, was picked as stock of the day today by
have soared after the company announced an alliance with
to develop and market e-Net's
long-distance telephone service over the Internet. e-Net was up 3 1/2, or 114%, at 61 /2. IXC was down 11/16, or 2%, at 32 1/4.