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Tech Industry

MARKET CLOSE: Internet stocks buck selling trend

The Dow Jones industrial average fell 126 points to 10,991.38 Wednesday and the Nasdaq composite chopped off 13 points to close at 2,657.73. Despite the losses, leading Internet stocks made strong gains.

"The only problem we have today is the Dow was up 600 points from its intra-day low last Tuesday. We're taking a very normal siesta," said Alfred Goldman, a technical analyst at A.G. Edwards and Sons in St. Louis. "It's still a good day. It's still a bull market."

Merrill Lynch analyst Henry Blodget lit a fuse under the Internet sector after naming eight stocks he believes "offer a sound way to play the fundamental strength and renewed investor enthusiasm we expect to see during the fall and holiday shopping season."

Blodget raised his rating on retailer Amazon.com (AMZN) and Yahoo! Inc. (YHOO) to near-term "buy" from "accumulate." Amazon.com closed up 3 7/8 to 113 1/8 while Yahoo! picked up 6 3/16 to 145 1/16.

Lycos Inc. (LCOS) shot up 2 7/16 to 44 3/4 after Bear Stearns raised its fiscal 2000 revenue estimate for Lycos to $236.3 million from $209.5 million, and reiterated its "buy" rating. PaineWebber also raised its rating on Lycos from "neutral" to "buy." Lycos topped estimates with a small profit in its fourth quarter Tuesday.

eToys Inc. (ETYS) moved up 4 15/16 to 45 3/16.

America Online Inc. (AOL) added 1 1/2 to 99 while Infoseek Corp. (SEEK) and Excite@Home Corp. (ATHM) closed up 3/16 and 7/16 a share, respectively.

Dell Computer Corp. (DELL) gained 3 7/16 to 44 9/16 as the Nasdaq's most actively traded issue after it reporting better-than-expected second quarter results and predicted strong performance for the second half.

Compaq Computer Corp. (CPQ) lost 3/4 to 23 3/8 and Apple Computer Inc. (AAPL) dropped 3/16 to 60 1/8. Gateway Inc. (GTW) rose 5 3/4 to 91.

Intel Corp. (INTC) finished off 1/2 to 78 1/2. Advanced Micro Devices Inc. (AMD) shed 1/16 to 18 9/16 and IBM closed off 4 1/2 to 124.

Analog Devices (ADI) lost 1 15/16 to 44 13/16 after it posted third quarter earnings of 30 cents a share Wednesday, beating First Call consensus by a penny. The semiconductor manufacturer cited an increase in orders for it results and was bullish on the fourth quarter.

Microsoft Corp. (MSFT) checked in with a gain of 7/16 to 85 and Sun Microsystems Inc. (SUNW) chipped off 1 1/2 to close at 73 5/16.