Meltdown Averted
Stocks were mixed Tuesday with the Nasdaq slipping a tad but still holding on
to most of Friday’s 7.6% rally. Technology issues slid into mid-day but warmed
up late in the session, allowing the Nasdaq to reverse much of its dip to close down
just 0.9% for the day. Blue chips held on to moderate gains, with the Dow and
S&P 500 rising 0.5%, and 0.7%, respectively.
In light, post-holiday action, just 1.55 billion shares traded on the Nasdaq
while just 802 million shares changed hands on the NYSE.
Analysts were optimistic about the intermediate-term direction of rates, but
most remained realistic about the near-term direction of stocks given the slew
of negatives pervading the market.
“I think the Fed certainly lowers interest rates next month at the Jan.
30 meeting, and I’m not counting on anything in between. It’s possible, but I
think the more likely scenario is that you get a 50 basis point decline at the
Jan. 30-31 meeting,” said Barry Hyman, Chief Market Strategist, Weatherly
Securities.Â
“There’s just intense pressure on the small cap end of the market
because of margin problems, a lack of liquidity, and really no Internet market
left other than some of the big, branded names. We’re going to go into 2001
ending this year on a quiet note, with light volume for the rest of the week. I
think there could be somewhat of a pickup at the end of the week as tax selling
abates and the presumption emerges that something good can happen in 2001 after
a horrendous year,” he added.
According to preliminary numbers, the Dow gained 56.88 to 10,692.44, the
Nasdaq fell 23.37 to 2493.65, and the S&P 500 added 9.25 to 1315.20.
Top sectors were oil services
(
$OSX.X |
Quote |
Chart |
News |
PowerRating), up 5.6%, Japanese stocks
(
$JPN.X |
Quote |
Chart |
News |
PowerRating),
up 4.3%, integrated oils
(
$XOI.X |
Quote |
Chart |
News |
PowerRating), up 3.3%, and consumer stocks
(
$CMR.X |
Quote |
Chart |
News |
PowerRating),
up 1.8%.
On the weaker side were retailers
(
$RLX.X |
Quote |
Chart |
News |
PowerRating), down 2.0%, AMEX Internets
(
$IIX.X |
Quote |
Chart |
News |
PowerRating), down 1.7%, computer technology
(
$XCI.X |
Quote |
Chart |
News |
PowerRating), down 1.7%, and
semiconductors
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), down 1.4%.
Despite a downgrade from DB Alex Brown, optical networker JDS Uniphase
(
JDSU |
Quote |
Chart |
News |
PowerRating)
managed fight its way back from an intraday low of 38 9/16 to close up 15/16 to
41 7/8 on heavier-than-average volume.Â
Among recent winners, Fannie Mae
(
FNM |
Quote |
Chart |
News |
PowerRating) added 3 1/2 to 85 3/8 as falling
interest rates continue to invigorate the financials. Fannie Mae is within
striking distance of last week’s all-time high 89 5/16 that it hit on Dec. 18.
Top Dow stocks were Philip Morris
(
MO |
Quote |
Chart |
News |
PowerRating), up 2.4%, Merck
(
MRK |
Quote |
Chart |
News |
PowerRating), up 2.4%,
and Caterpillar
(
CAT |
Quote |
Chart |
News |
PowerRating), up 2.4%. Dow dogs were Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating), down 3.6%
and IBM
(
IBM |
Quote |
Chart |
News |
PowerRating), down 4.7%.
Looking ahead, the index of leading economic indicators is due out Wednesday at 10:00 AM ET, and analysts expect a decrease of 0.2%.