Big Gains Maintained
Following its stunning post-Fed rally on Wednesday, the Nasdaq managed to
give back just 1.9% Thursday, as tech stocks digested the previous day’s run-up.
Blue chips also kept their composure with big gains in retailers, cyclicals and
telecom that kept the Dow and S&P 500 losses to just 0.3% and 1.0%,
respectively.
Volume surged on the NYSE to 2.1 billion shares, which was another record for
NYSE trading. Nasdaq volume remained heavy, though its 2.6 billion shares were
about 13% less than Wednesday’s record session.
Traders are concerned that despite the Fed’s ride to the rescue, the
market will continue to worry about the upcoming earnings season which likely
promises more disappointments than positive surprises.
“Obviously the benefit of a Federal Reserve rate hike intermittently
will add some needed liquidity, but I think we still have first quarter earnings
upon us which will be lackluster at best. I think were seeing a good start to a
basing process, but I think it’s really nothing more than that,” said Gregg
Parise, General Partner, Dorado Capital Management LLC.
“Once these earnings announcements start to come out and continue to be
disappointing at best, people are going to realize that it’s earnings that drive
stocks and the Fed assists in that. I’m looking for the possibility for another
rate cut at the end of January, and if not then, then probably in early March we
will get one. But I still think that this is excellent as far as helping along
the bottoming process,” he added.
According to preliminary numbers, the Nasdaq lost 49.85 to 2566.84, the Dow
eased 33.34 to 10,912.41, and the S&P 500 slipped 14.22 to 1333.34.
Top sectors were transportation
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up 3.7%, telecom
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3.1%.
Under pressure were biotechnology
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down 6.4%, and health care
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Select softwares were higher, thanks in part to BMC Software saying it would
beat analysts earnings expectations. BMC rose 6 3/4 to 22 3/8, and that seemed
to help Veritas Software
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As the government came closer to finally approving the AOL
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Warner
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In an related editorial today, The Wall Street Journal commented that the
increased regulatory influence over broadband access may be unnecessarily
slowing the evolution of and access to high-speed Internet technology.
Dow winners were Eastman Kodak
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4.7%, AT&T
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included such recent favorites as Philip Morris
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down 4.6%.
Looking ahead, traders look toward Friday’s employment numbers to see if
there is a possible surprise or two that the Fed may have been reacting to when
it cut rates on Wednesday. The report will be released at 8:30 AM ET.