CNET Cooks on Web Chatter,
Until Word Comes to Get Out
By SUSAN PULLIAM and REBECCA BUCKMAN
Staff Reporters of THE WALL STREET JOURNAL
The blizzard of cyber-messages started early in the morning on Monday, March 1. Most were brief and to the point, like one dispatched at precisely 41 seconds after 10:18 a.m. EST.
"WINNER ALERT: CNET 123."
To cognoscenti of trading-places.net, an Internet chat room for day traders, the message was unmistakable: Keep buying shares in CNET Inc., then trading in the low $120s and already up more than $7 a share on the day.
Three minutes later came another message: CNET "IS A MONSTER CALL!!!" Then, six minutes after that, "TRADE ALERT: CNET volume picking up, you chart watchers, when you see the volume go up bigger this thing gonna explode."
See highlights of the CNET discussion
See an expanded transcript of the CNET discussion
Explode it did. For the next hour and a half, more than 200 messages, sometimes several a minute, poured forth extolling CNET, a San Francisco company that operates a computer-information network on the Web. "Its gonna fly soon," said one at 11:01, from "skibum." Minutes later, he added, "sorry about the hype, but when I find easy monstas, i like us to be in." At 11:38, CNET hit $139 a share -- up more than $23 for the day.
Uh-Oh
But two minutes later, the day traders riveted to trading-places.net read a very different message: "PULLBACK ALERT: CNET I WOULD TAKE PROFITS HERE," wrote "Merlin" -- not once but five times in seven seconds. In short order, trading volume in CNET on the Nasdaq Stock Market jumped, and the price fell. By day's end, the stock had racked up tremendous volume equal to more than twice the number of freely tradable shares and posted a 15-point gain. All this on a day when CNET announced no news.
Continued:
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