Nasdaq Hits The Gas

August 3, 2000
Daniel Beighley

After gapping down at the open Thursday, the Nasdaq traded down 137 points in
the first half-hour of trading before reversing and battling back to finish 2.8%
higher for the day. Financial stocks helped power the S&P 500 up nearly 1%,
while the Dow only managed to rise 0.2%.

Internets, networkers and giant-cap technology stocks powered the Nasdaq
engine, as Nasdaq trading volume surged 20% above Wednesday’s level to 1.81
billion shares. NYSE volume increased slightly to 1.05, which was about 5% above
Wednesday’s total.

While traders and analysts were impressed by the remarkable intraday
turnaround, several commented that the market is still not out of the woods,
especially with the Nasdaq still nearly 140 points below its 200-day moving
average.

“It seems to me that it’s still a very dangerous market. This August to
September period is historically a weak time, and I think that until we get
through at least part of September, we have to be very cautious here,” said
Ricky Harrington, Technical Analyst, Wachovia Securities.

“One very obvious reason is that the market continues to not respond to
news in a favorable manner. Second quarter earnings have come out more or less
better than expected, and stocks have generally not acted well at all. How the
market reacts to news is always an important factor to consider, and these
reactions show that we’re still in a vulnerable period,” he added.

According to preliminary numbers, the Nasdaq gained 101.34 to 3759.80, the
S&P 500 rose 13.86 to 1452.56, and the Dow added 19.05 to 10,706.58

The much-anticipated employment report will be released Friday at 8:30 AM ET,
and Street estimates look for 71,000 new non-farm jobs, the unemployment rate to
remain at 4.0%, and an increase of 0.3% in the average hourly wage.

Nasdaq Hits The Gas

BUY THE FEAR, SELL THE GREED

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