The Dow Jones Industrial Average pulled way back, falling 94.07 points or nearly one percent, to close at 9,903.55. Although the Dow made a run at 1,100 by hitting 10,085.31 this morning, it has yet to close above 10,000. It ended the day yesterday at 9,997.62 after zigzagging around the much-anticipated threshold.
After a strong start this morning, technology stocks lost their spark and fell hard after an influential investment bank lowered IBM's price target to 195 a share from 210.
Although Morgan Stanley Dean Witter kept its "outperform" rating of IBM, technology issues fell on concerns that there will be a slowdown in personal computer sales. Dell Computer and Compaq Computer have been sliding for the past few weeks over the worry.
IBM tumbled 5.21 percent, while Dell and Compaq shed 4.73 percent and 3.73 percent, respectively.
With the news of the new price target, the Nasdaq Composite Index's unease turned into a full-blown slide. The technology-heavy index tumbled 41.47 points or 1.6 percent, closing at 2,421.49.
Despite the downturn today, there were a few bright spots. Among Internet stocks, newcomer iVillage stole the show with its debut.
iVillage, a Web site targeted at women, bust through the seams, rising a whopping 233.85 percent on its first day of trading. The stock rose 56.13 points to hit 80.13.
iVillage yesterday set its IPO price at 24 a share after nearly doubling its pricing range earlier this week because of heavy investor demand. The issue is trading under the symbol "IVIL."
Cheap Tickets also soared today in its first day of trading, rising 108.33 percent to 31.25. The discount airline tickets e-tailer also repriced its IPO price to 15 per share because of heavy interest. The original range was 11 to 13.
The meteoric rises of those IPOs, however, did not help the languishing Nasdaq market. Most other major Internet stocks were posting either modest gains or modest losses.
America Online, part of the S&P 500, climbed 2.42 percent. Egghead.com, which jumped 29.15 percent higher yesterday after an investment bank began coverage of the e-tailer with a "strong buy" rating, crumbled after another earlier rise. The issue dropped 10 percent after rising as much as 7.43 percent.
Preview Travel tanked 17.01 percent after Paine Webber cut its outlook on the company to "neutral" from "buy."
Paine Webber analyst James Preissler said he was downgrading the company following the resignation of its CFO, Ken Pelowski. Because Preview's CEO, Ken Orton, also recently resigned, Preissler said "the ranks are a little thin at the top."
Preissler added that it is critical to have a strong management team in this "fast-moving, highly competitive space."