Seeking Inspiration
More Cisco-induced weakness in the tech group weighed on the Nasdaq again
Thursday as the average remained lethargic and faded late in the day to close
down 1.7%. The broader market was also sluggish as stocks simply failed to find
much inspiration anywhere. For the day, the Dow and S&P 500 each lost about
0.6%.
Volume eased by about 8% from Wednesday’s levels, as the Nasdaq saw 1.84
billion shares trade and the NYSE saw 1.08 billion shares change hands.
The psychological fallout from having even ever-dependable Cisco left many
traders wondering whether their would be yet more pain in the earnings arena.
"I think people are still realizing here mid-way through the first
quarter that fundamentals are still deteriorating and getting worse. People are
realizing there still could possibly be another shoe to drop," said Greg
Parise, General Partner, Dorado Capital Management.
"While the market is trying to find a base here and look out 3, 6 or 9
months, it seems to me that we’re finally starting to stabilize as we see the
market attempt to discount how poor the fundamentals are. Then you throw in the
fact that the Fed is on the market’s side, and I just think this is a good solid
part of a bottoming process," he added.
According to preliminary numbers, the Nasdaq lost 45.76 to 2562.06, the Dow
slid 66.17 to 10,880.55, and the S&P 500 eased 8.36 to 1323.53. At its
current level, the S&P 500 is teetering about 3 points below its 50-day
moving average.
Top sectors included transportation
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Under pressure were gold and silver
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technology
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Avoiding the tech swoon was Hewlett Packard spin-off Agilent Technologies
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which gained 4.07 or 8% to 54.21 on word it would use a new visual software in
its optical networking products.
Electronic Data Systems
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5.61 or 10% after topping earnings estimates. EDS has a history of good economic
performance in weakening economic cycles, so that also may have enlivened the
stock.
Dow winners were Disney
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and American Express
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which fell 4.3%.
Looking ahead, the next economic number due out are the January retail sales
numbers which will be released Tuesday at 8:30 AM ET. Analysts expect a 0.3%
increase.