Blue-chip and Internet stocks struggled Wednesday as the Dow Jones industrial average fell 157 points to 10,561.41 while the Nasdaq composite inched up 6 points to close at 4,427.15.
Stronger-than-expected housing data sparked nervousness over rising interest rates. Data from the Commerce Department showed U.S. housing starts rose 1.5 percent to an annual rate of 1.78 million in January. Analysts had expected starts to fall to an annual rate of 1.65 million.
"Volatility changes the view from day to day. We've got this very bipolar market," said Gail Dudack, chief investment strategist at Warburg Dillon Read.
Microsoft Corp. (MSFT) shares fell 15/16 to 97 5/8, pushing it well below its 52-week high of 119 15/16 set in December. Oracle Corp. (ORCL) trimmed 1/8 to 61 1/4 and Sun Microsystems Inc. (SUNW) fell 1 11/16 to 92.
Lycos Inc. (LCOS) was the lone bright spot among widely held Internet stocks as its shares closed up 3 9/16 to 72 5/8 after beating estimates in its latest quarter. Yahoo! Inc. (YHOO) fell 8 7/16 to 161 9/16 and America Online Inc. (AOL) dropped 2 1/4 to 51 3/4.
Internet healthcare giant Healtheon/WebMD Corp. (Nasdaq: HLTH) closed off 3/4 to 67 7/8 after it snapped up another competitor Wednesday with its purchase of OnHealth Network Company.(Nasdaq: ONHN). OnHealth shares closed up 1 15/32 to 11 7/16.
Web search system Ask Jeeves Inc. (Nasdaq: ASKJ) slid 4 to 78 1/2 after it said it has filed with regulators for a proposed offering of $150 million of its common stock.
LendingTree Inc. (Nasdaq: TREE), which connects consumers with lenders on the Web, defied the fear of higher rates, and gained 6 to 18 in its initial public offering.
Be Free (Nasdaq: BFRE) closed off 1 7/8 to 106 1/4 after it announced plans to buy TriVida for 1.56 million of its shares. The company also topped estimates in the fourth quarter and announced a 2-for-1 stock split.
Among widely held PC stocks, Dell Computer Corp. (DELL) inched up 1/8 to 38; Compaq Computer Corp. (CPQ) lost 1 3/16 to 25 13/16; Gateway Inc. (GTW) shed 1 1/2 to 55 1/2 and Apple Computer Inc. (AAPL) closed off 5 1/16 to 113 15/16.
On the earnings front, Metricom (Nasdaq: MCOM) lost 1/2 to 95 3/4 after it reported a whopping fourth-quarter loss of $2.51 a share as it continued to bleed red ink due to the rollout of its Ricochet product for wireless Internet connections.
Fueled by demand for communications processors, Analog Devices (NYSE: ADI) topped Wall Street estimates by a nickel in the first quarter, issued a bullish outlook and announced a 2-for-1 stock split. Its shares closed up 7 1/8 to 127.
Intel Corp. (INTC) shaved off 4 13/16 to 107 3/16 and Advanced Micro Devices Inc. (AMD) tacked on 1/4 to 43 3/4.