Nasdaq’s Rebound Ends Amid Profit-Taking; Dow Falls
Stocks ended mixed Wednesday as the Nasdaq market’s attempt at a third-straight rally fizzled late in the day.
In other trading, the euro fell to a new low against the dollar.
On Wall Street, the Nasdaq composite slid 87.16 points, or 2.3%, to 3,706.41 after rising as much as 58 points.
After plummeting a record 25.3% last week as technology stocks were hammered across the board, Nasdaq resurged 6.6% on Monday and 7.2% on Tuesday.
But amid some mildly disappointing earnings reports from tech sector leaders, profit-taking hit many of the shares Wednesday.
Intel lost $9.94 to $119.06, IBM slid $6.50 to $105, and Broadcom dropped $14.75 to $142.25. All three reported earnings after regular trading ended Tuesday.
The Dow Jones industrials fell 92.46 points, or 0.9%, to 10,674.96.
Late in the day, the broad market was hurt by a plunge in drug giant Bristol-Myers Squibb’s shares after the company said it will withdraw a drug application for hypertension drug Vanlev from the Food and Drug Administration.
Still, rising stocks outnumbered losers by 23 to 18 on Nasdaq, and winners and losers were about even on the New York Stock Exchange.
Analysts noted that volume slowed sharply, to about 1.8 billion shares on Nasdaq. Overall, the session was one of the calmest of the year, in contrast to the violent market swings of recent weeks.
That may signal that many investors are stepping away early, in advance of the long weekend. Today is the final trading day of the week: Markets will be closed in observance of Good Friday.
Wednesday’s renewed slide in the Nasdaq index reminded investors that last week’s devastating sell-off has left the market vulnerable, analysts said.
“More than anything else, we had a negative reaction to the two strong days that came before,” said Ricky Harrington, technical analyst at Wachovia Securities in Charlotte, N.C. “The market has had a strong technical rally, but it might not yet be sustainable.”
Nasdaq still is down 26.5% from its record high reached March 10. Many tech issues have plunged far more from their peak levels.
In other markets, Treasury bond yields fell as investors snapped up 30-year bonds before the government buys back $2 billion of long-term debt today. The 30-year T-bond yield slipped to 5.85% from 5.91% on Tuesday.
In currency trading, the euro sank to a new low against the dollar, despite news of a record U.S. trade deficit that would have been expected to weaken the dollar.
Instead, the booming growth and investment in the U.S. economy is seen outweighing the effects of the deficit and boosting the dollar, analysts said.
The euro tumbled to 94 cents from 94.8 cents Tuesday. It was worth $1 as recently as Feb. 23.
Among Wednesday’s highlights:
* Major tech stocks pulling back included Oracle, down $4.38 to $74.56; Micron Technology, down $9.50 to $117; Apple, off $5.75 to $121.13; and Texas Instruments, down $7 to $143. But America Online gained $1 to $61.75 and Qualcomm rose $2.56 to $114.75. Both reported earnings late Tuesday.
* Other tech issues rising on earnings news included International Rectifier, up $6.81 to $45.50; and Internet software firm Inktomi, up $17.13 to $133.13 after reporting its first profitable quarter.
* Biotech shares were mixed. Amgen lost $2.38 to $56 and Genentech slid $9.38 to $126.13, but Abgenix gained $12.81 to $94.75 and NeoRx rose $1.19 to $13.50.
* Many drug shares held on to big gains despite Bristol-Myers’ plunge. American Home Products rose $2.75 to $59.13 and Merck gained $2.75 to $69.
* Temporary-staffing firm Robert Half soared $8.44 to $57.31 after a strong earnings report prompted brokerage Warburg Dillon Read to raise its 12-month price target on the shares to $66.
* Many energy shares rallied, with Exxon Mobil up $1.25 to $77.44, Unocal up $1.13 to $30.13 and Apache up $2 to $48.50.
* Venturing into a tough market, fiber-optic network builder 360Networks priced its initial stock offering at $14 a share, well below the $18 it hoped to get. The stock begins trading today under the symbol TSIX.
Market Roundup, C10-11
