New millennium, old tune
New millennium,
old tune. Outside of tech, nothing moved…except
down.Â
Bonds, fresh off their worst year in
history (the 30Y lost over 14% in ’99), saw their yields spike to levels not
seen in 2 1/2 years. The 30Y went out at 6.598%.
The financials, which were dented by a
substantial hit to the bond, saw some brokers like Bear [BSC>BSC], Morgan
Stanley [MWD>MWD], Lehman [LEH>LEH], Legg Mason [LM>LM] surrender 5% to
8%.Â
The trade of the day was the opening
reversal. Once everyone got their Y2K-was-OK buy orders filled, a vacuum quickly
set in. The opening gap in the techs came and went. And went in a hurry. Then
the bottom came around 11:15 a.m. ET. But the Internets actually put in a floor
just before 11, which gave you a subtle hint that the group was set to
outperform. They then completely dominated the afternoon
session.Â
Incidentally, buying puts last week
didn’t cut it…the VIX rose every day of last week, then imploded
Monday.
Among tech
benchmarks, winners snuffed out losers by 2 to 1…Showing
distribution: Cisco [CSCO>CSCO], Applied [AMAT>AMAT], Dell [DELL>DELL],
Microsoft [MSFT>MSFT], and Sun [SUNW>SUNW]…Compaq was the star, up 13%
to a level not seen in nearly nine months…EMC [EMC>EMC], Ericsson
[ERICY>ERICY], H-P [HWP>HWP], Intel [INTC>INTC], and Oracle
[ORCL>ORCL] all showed solid accumulation.
In cyberspace, every top-tier name rode
higher. CMGI [CMGI>CMGI] blasted out of a six-day congestion area on over
double average turnover…DoubleClick [DCLK>DCLK] and Yahoo! [YHOO>YHOO]
also moved out on nice volume…even group laggards Amazon [AMZN>AMZN] and
AOL [AOL>AOL] cobbled together 17% and 9% gains, respectively.
The B2Bs
gained, but actually took a back seat to Web
blue-chippers.
Elsewhere, Brocade [BRCD>BRCD] did a
little headfake, as if to say it was ready to follow through on Friday’s
breakout from a five-week base–but the move was met by sellers…Computer
Network Technology [CMNT>CMNT] was a disappointment as it broke down on
volume five times its norm, completely knifing through all of its support levels
of the past five weeks…Comverse [CMVT>CMVT] met with a better fate,
following through on Friday’s breakout from a six-week base, with volume the
heaviest in four weeks…Foundry [FDRY>FDRY] cleared new high ground after a
six-day pullback, but closed just shy of its prior best.
At press time, Kevin N. Marder held a
long position in AOL.