Burt, one analyst seems to think the late-day run-up was due to a technology conference going on in Arizona...maybe something was said..all I know there was lots of momentum at the end of the day!
joey
cbs.marketwatch.com
'Nets warm up
Stocks spring back
By Kevin N. Marder, CBS MarketWatch
Last Update: 5:14 PM ET Dec 1, 1998
Bond Report
NEW YORK (CBS.MW) -- Potent buying in bedrock technology names
allowed the U.S. stock market to put Monday's dreary session behind it,
with Internet shares also scampering back into investors' good graces in
heavy Tuesday dealings.
The Dow Jones Industrial Average advanced 17.51 points, or 0.2
percent, to 9,134.06. It fell as much as 128.73 points in the early going
before players dove back into marquee-name computer shares, spurring
buying in other segments.
"You had the market down in the morning and then Cisco, Microsoft,
Intel, WorldCom, and Dell turned positive," said Scott Bleier, chief
investment strategist at Prime Charter Ltd. "There's the big CS First
Boston technology conference going on in Arizona, and those conferences
are usually lovefests. And that's what I think took the market back up."
Beneath the popular averages, the excitement lay in the multiple-point
wins printed by the market's big technology guns. International Business
Machines rallied 4 3/4 to 169 7/8, Intel 7 3/8 to 115, Microsoft 7 1/2 to
129 1/2, Cisco Systems 4 3/8 to 79 3/4, and Dell Computer 4 to 64
13/16.
Sun Microsystems (SUNW) was ahead 5 7/8 to 79 15/16.
PaineWebber's Investment Policy Committee added Sun to its
"highlighted stocks" list.
EMC (EMC) gained 4 5/8 to 77 1/8 after SoundView Financial boosted
its price target on the data storage specialist.
Internet stocks, Monday's big losers, bounded into positive territory after
the early rampdowns. Among electronic commerce names, eBay added 9
5/8 to 207 1/4, Cyberian Outpost 1 7/8 to 27 3/8, Amazon.com 17 1/2
to 209 1/2, and Beyond.com 3 1/8 to 24 7/8. But Books A Million
dipped 5 to 24 1/2. In two sessions last week, the stock exploded for a
1000 percent advance.
WavePhore (WAVO) leaped 7 1/2, or 97 percent, to 15 1/4. It launched
an electronic commerce channel, the WaveTop Store, and established
nine initial merchants as part of the online mall.
And Bluefly (BFLY) soared 6 1/8, or 41 percent, to 20 15/16. The
operator of online fashion outlets will open a co-branded retail site on
Yahoo! Shopping. See full story.
Gains in Internet portal shares were more subdued. Yahoo! firmed 14 1/4
to 206 1/4 and America Online 2 3/8 to 89 15/16.
"The Internet stocks have basically shot their loads," Bleier said. "These
stocks remind me of the investment pools of the 1920s, when groups of
investors would corner a stock, lock up their supply, and run the stock
up. Then the investing public would get in, since there were momentum
players back then also, and they would dump the stock to the momentum
players. This is similar to what's happening today with the Internet stocks.
"The Internet is changing the face of commerce, there is no doubt," he
said. "But this is not the second coming. These stocks will all be
considerably lower. Maybe less so with America Online because it's the
number one institutional holding." See related story.
"When sentiment gets to extremes it always leads to a turn in the market,"
said Gary B. Kaltbaum, chief technical analyst at J.W. Genesis
Securities Inc. "It happened at the bottom when everybody was saying
we're going to have a global crash after it happened. It just so happened
that it coincided with the big Internet froth with the excessive bullishness.
And boom, to the day, the market tops.
"If you get some of these people that said Dow 10,000 is a lock by the
end of the year to shut up, and you get some skepticism back into the
market, I'd consider this to be a pause that refreshes," he said. "Then we
can get this thing going again."
Over on the economic table, the National Association of Purchasing
Management's manufacturing index fell to 46.8 percent in November from
October's 48.3 percent. A survey conducted by CBS.MarketWatch.com
had projected the number to come in at 47.9 percent. A figure above 50
percent indicates expansion in the manufacturing sector, while a sub-50
percent reading correlates with a contracting manufacturing economy.
"In our opinion, the market's recent spectacular advance from the
October 8 low is not over," Ralph Acampora, director of technical
research at Prudential Securities, said in a research brief. "Any pause
could be deemed a buying opportunity, so an aggressive investment
posture is warranted.
"We believe that due to the market's upward momentum and the
impressive leadership, excluding the Internet stocks, the odds are better
than 50-50 that the DJIA will reach 10,000 by the end of the year."
The Standard & Poor's 500 Index rose 1.0 percent.
New York Stock Exchange declining issues outdid gainers by 16 to 15.
On the Big Board floor, volume swelled 14 percent to 787 million shares.
The Nasdaq Composite advanced 2.8 percent. Declining issues led
advancers by 22 to 17 in the Nasdaq Stock Market. Volume totaled 1.02
billion shares.
The Russell 2000 Index of small-capitalization stocks gained 0.2 percent.
In the bond market, the 30-year Treasury advanced 10/32, to yield 5.050
percent. See Bond Report.
In special situations, Exxon (XON) buttoned up plans to buy Mobil
(MOB) for about $77 billion in stock. The deal would be the biggest
corporate hookup ever. Shares of Exxon, the largest U.S. oil concern,
lost 3 1/4 to 71 3/4, while stock of Mobil, the second-biggest U.S. oil
interest, sank 2 1/4 to 83 3/4. See full story.
Belgium's Petrofina SA (FIN) spurted 8 1/8 to 48 13/16. Total SA
(TOT), a French oil concern, will buy 41 percent of the company for
$12.7 billion in stock. Total shares sank 5 5/8 to 55 1/2. See full story.
In other specific issues, Pacific Sunwear (PSUN) swooned 1 9/16 to 13
1/4 after divulging that November sales at outlets open a year or more
declined 1.6 percent from the year-ago figure. The apparel retailer also
set a buyback plan of up to 1 million shares of its stock. See full story.
Starbucks (SBUX) gained 3 15/16 to 50 1/16. The coffee purveyor said
sales at stores open at least a year grew 6 percent in November. Lehman
Brothers analyst Mitchell Speiser fattened his price target to $67 a share
from $52.
Twinlab (TWLB) dropped 3 5/8, or 22 percent, to 13. The nutritional
supplements producer steered analysts to expect fourth-quarter earnings
of 23 cents to 26 cents a share. Most observers had forecast 41 cents.
Twinlab is experiencing slowing sales as well as some production
problems related to its TruHerb line of products.
Computer disk drive stocks, hot performers since the Oct. 8 market
lows, steamed higher, with Western Digital jetting 4 3/4, or 36 percent, to
17 13/16. The company's chief executive, speaking at the Credit Suisse
First Boston technology conference in Arizona, said product demand is
firming.
Other disk drives rallied in sympathy with Western. Seagate Technology
tacked on 2 1/4 to 31 3/4, Quantum 1 3/4 to 23 7/8, Read Rite 1 3/4 to
15 3/16, Storage Technology 1 5/8 to 36 5/8, and Hutchinson
Technology 1 3/16 to 32 1/8.
COMMODITIES
New York light sweet crude for January delivery declined 10 cents to
$11.12.
February gold rose 90 cents to $296.00.
CURRENCIES
Dollar/yen was quoted at 122.10 from Monday's 122.92.
Dollar/mark was at 1.6831 from 1.6932. See latest currency rates.
Kevin N. Marder is markets editor for CBS MarketWatch. |
