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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: edamo who wrote (26274)	12/20/2000 12:28:05 PM
From: stockman_scott	Respond to of 65232

Stocks in Red as Angst Plagues Street Wednesday December 20, 11:52 am Eastern Time By Denise Duclaux NEW YORK (Reuters) - Stocks swooned in late morning trading on Wednesday as the corporate profit picture dimmed in the wake of a warning from the U.S. Federal Reserve that the nation's economy may be slowing too fast. ``It's not a pretty sight at all,'' said Donald Berdine, chief investment officer at PNC Advisors. ``There is still concern on most people's minds about how weak or how rough the economy will be next year.'' The technology-dominated Nasdaq Composite Index (.IXIC) tumbled 117 points, or 4.68 percent, to 2,394, after it scraped a new bottom for the year at 2,371.02. The Nasdaq is now off more than 50 percent from its March high. Cisco Systems Inc. (NasdaqNM:CSCO - news) led the fall, down almost 10 percent, or $4-1/8, to $37-5/8, after premier Wall Street house Merrill Lynch cut its investment rating on the Internet gear maker and blamed a slowdown in technology spending. The Dow Jones industrial average (.DJI) fell 107 points, or 1.01 percent, to 10,477, after losing almost 2 percent earlier. The world's largest computer company, International Business Machines Corp. (NYSE:IBM - news), off $3-3/8 to $86-3/4, and computer and printer giant Hewlett-Packard (NYSE:HWP - news), down $1-1/2 to $29-13/16, pressured the blue-chip gauge after Merrill lowered its ratings on those stocks as well. The broader Standard & Poor's 500 Index (.SPX) dropped 21 points, or 1.68 percent, to 1,283, after touching a fresh year low of 1,275.53 earlier. ``Techs are overvalued, especially considering the likelihood of a slowdown in the global economy next year and a barrage of warnings daily,'' said Bill Meehan, chief market analyst at Cantor Fitzgerald. International Paper Co. (NYSE:IP - news), a Dow component, edged down 7/8 to $38-5/8 on the New York Stock Exchange. The world's largest paper and wood products company said earnings were expected to fall below estimates, partly because of rising energy costs. Networking equipment maker Foundry Networks Inc. (NasdaqNM:FDRY - news) plunged about 55 percent, or $16-7/8, to $13-3/4 on the Nasdaq after warning that earnings would fall below analysts' expectations, due to a shift in spending on communications infrastructure. Jabil Circuits Inc. (NYSE:JBL - news), a leading contract electronics manufacturer, skidded 22 percent, or $6-1/4, to $21-9/16 on the New York Stock Exchange after saying quarterly earnings fell short of expectations because of shortages of key parts. Extreme Networks Inc. (NasdaqNM:EXTR - news) lost $14-5/8 to $33-15/16 on the Nasdaq after SG Cowen cut its rating, saying shares of the computer networking company seemed overvalued and would be hurt by a slowing economy. The fresh profit woes come one day after the U.S. Federal Reserve left interest rates steady, helping to trigger a steep sell-off amid fears the economy was winding down too sharply from its once torrid pace.