Nasdaq Rally Attempt Beaten Down Again
Stocks ended mostly lower Tuesday as rally attempts in the battered Nasdaq market met with more selling.
Meanwhile, in currency trading, the dollar rose to its highest level since February against the yen amid a political struggle in Japan.
On Wall Street, most key indexes showed small net changes for the day in moderate trading. The Nasdaq composite, which sank 5% on Monday to a 12-month low, eased just 4.19 points, or 0.2%, to 2,871.45 on Tuesday.
But it was worse than it looked: Losers swamped winners by 24 to 14 on Nasdaq. And though the Dow industrials gained 31.85 points, or 0.3%, to 10,494.50, the index gave up most of a 100-point intraday gain. Losers also had a narrow edge on the New York Stock Exchange.
Uneasiness about weakening corporate profits, the country’s economic slowdown, the election stalemate and more analyst downgrades of high-profile stocks are making it impossible for any substantial gains to stick, traders said.
Many potential buyers, experts say, simply aren’t willing to step up.
On the plus side, a few tech companies’ earnings reports were rewarded Tuesday. Agilent Technologies soared $4 to $48.63 on its report.
But software firm Cacheflow, which after the close of trading reported a quarterly loss, plunged to $59 in after-hours trading. The stock had fallen $14.81 to $76.19 in regular trading.
Also, software maker Intuit sank to $42.50 in after-hours activity after it reported a quarterly loss. The stock had fallen $5.19 to $48.19 in regular trading.
“We are still going to have to come to grips with earnings expectations that are too high,” said Jim Myers, director of technical research for brokerage Janney Montgomery Scott in Philadelphia.
Elsewhere, the strong dollar flexed its muscles again, this time against the Japanese yen: The dollar rose to 110.16 yen in New York, up from 109.92 on Monday and the highest since February.
Japan’s prime minister, Yoshiro Mori, scraped through a no-confidence vote in parliament on Monday. The political struggles may spook investors, traders warn.
Japan’s political turmoil also sent the Nikkei-225 stock index down 123.19 points to 14,408.46, a 20-month low.
Among Tuesday’s highlights:
* Major Internet stocks helped lead the tech sector lower, amid negative comments from analysts.
Another weak tech sector: chip stocks. Vitesse Semiconductor slid $3.63 to $60.31 and Transmeta fell $3.06 to $29.94. Also, LSI Logic fell $5.81 to $22.94 after key executives resigned.
* Some networking stocks rebounded after plummeting Monday. Cisco Systems gained $2.44 to $53.69 and Nortel Networks rose $2.94 to $38.19. But Juniper Networks slid $8.31 to $113.56.
* Some investors headed back into old-economy names. Food stocks continued to rise amid expectations of more consolidation in the business. General Mills rose $1.56 to $41.94, Heinz gained $1.06 to $45.38 and W.M. Wrigley rose $2.06 to $89.44.
Also, Pepsico surged $1.50 to $46.50 after saying it will buy back $4 billion of its shares over three years starting early in 2001.
Among other old-economy sectors, energy, drug and airline shares rallied.
* Mutual fund managers tumbled, with T. Rowe Price down $2 to $37, Janus funds owner Stilwell Financial down $3.50 to $37 and Affiliated Managers down $7.25 to $49.31 after Merrill Lynch analysts said the falling stock market is likely to hurt profits at fund firms.
* Shares of Pomona-based PCC Group, a computer-products distributor, were halted by Nasdaq in late afternoon, first because of pending news, then because Nasdaq said it wanted more information from PCC. Nasdaq didn’t say publicly what it was looking for. The stock’s last trade was at $1.
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Market Roundup: C9, C10
