CON-CALL EFFECT: Shares of Internet companies that sell goods and services via the World Wide Web surged Tuesday, all because of robust comments made during Netscape and AOL's conference call to investors.
Around 12:15 p.m. ET Tuesday, AOL chief operating officer Bob Pittman told investors most companies already know how to build "brick and mortar" stores. But they are "pretty lost when it comes to building virtual stores," Pittman said.
That's all a group of cyber-sale Internet stocks needed to toss off their lethargy. Shares of companies such as Cyberian Outpost (COOL), Onsale (ONSL), which opened an online holiday store, Egghead.com (EGGS), CDnow (CDNW), Beyond.com (BYND), eBay (EBAY), Cybershop (CYSP) and grandaddy of them all, Amazon.com, literally surged. Most pared their gains for the day, and Amazon shares actually closed lower. See Movers & Shakers.
Still, some of the stocks Tuesday, namely auctioneer Onsale and Cyberian Outpost, rose as much as 60 percent on trading volumes that were four and five times the individual shares' average daily trading activity. Onsale shares began their move to 50 from 32 about noon ET, just as Pittman was preparing his comments. Onsale closed at 43 7/8, up 14 7/8 for the day.
Pittman may have given investors the faith they needed to keep buying elecrtronic commerce stocks, which could benefit from tens of billions of dollars of electronic transactions in the coming year.
Pittman called Netscape-AOL "the master builder of virtual stores." See Silicon Stocks and Internet Daily. <Picture>
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Thom Calandra is CBS MarketWatch's editor-in-chief.
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