Will Fed Spark Market? The Clues

  • May 9, 2001
  • Dan Delaney

The techs weighed across the averages
Wednesday, keeping money on the sidelines, after Cisco Systems beat earnings
estimates by a penny but provided no encouragement for the latter half of the
year.

The Nasdaq Composite lost 1.9%, the
S&P 500 0.5%, and the Dow 0.2%.

With Cisco’s announcement now history,
the market faces little in the way of potential catalysts until next week’s
meeting of the Federal Open Market Committee, the monetary-policy leadership of the
Federal Reserve. The latest clues: On the positive side, evidence of labor
market weakness argues for further easing. On the negative side is this week’s
reported decline in productivity, a provocation for inflation hawks. 

Among the sectors, the Philadelphia
Gold and Silver Index
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possible uptick in inflation discounting on the heels of productivity data.

The Philadelphia Semiconductor Index
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3.2%, Amex Internet Index
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0.9%.

Among the day’s winners, Land’s End
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shot up 13.6% after the catalog apparel retailer reported earnings for the April
27 quarter of 20 cents a share, blowing away analyst estimates averaging 2
cents. Rite Aid
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better-than-expected quarterly results.

On the downside, Cisco
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Among the Dow stocks, Alcoa
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rose 2.7%, Procter & Gamble
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losers included Home Depot
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