With a miserable 2000 behind them, the U.S. markets begin a new trading year Tuesday with a host of downgrades in the information technology sector. The major Asian markets fell while Europe was mixed. The Dow is set to open slightly higher.
Fittingly, both the tech-laden Nasdaq as well the NYSE lost ground on the final trading day of 2000. The Nasdaq composite index ended the year with its worst perfomance since its inception in 1971 while the Dow Jones industrial average posted its first loss in a decade.
Robertson Stevens analyst Dane Lewis downgraded a number of stocks on concerns about a "significant slowdown" in information technology spending in the first quarter and, likely, the second quarter of 2001. CacheFlow (Nasdaq: CFLO), Quest Software (Nasdaq: QSFT), EMC (Nasdaq: EMC) and Veritas (Nasdaq: VRTS) were among the stocks that were cut.
On the economic front, the National Association of Purchasing Management will release its survey of manufacturing activity for December.
Expect the following technology stocks to be among Tuesday’s most actively traded issues: Brocade Communications (Nasdaq: BRCD), Carrier Access (Nasdaq: CACS) and Walt Disney (NYSE: DIS).
The Nasdaq dropped 87.24 to 2,470.52 on Friday while the Dow Jones industrial average shed 81.91 to 10,786.85.
At the Bell
The Dow Jones industrial average is expected to open up 14.5 points. The Standard & Poor's 500 futures index gained 1.80 to 1336.80, above fair value, at 7:30 a.m. EST.
The Inter@ctive Week @Net Index shed 14 to 279.60.
The major Asian markets fell back. The Nikkei 225 and Hong Kong’s Hang Seng both posted triple-digit losses, dropping 161.27 to 13,785.69, and 225.59 to 14,869.94, respectively. Singapore's Strait Times shed 30.55 to 1,896.28.
European markets were mixed. London's FTSE 100 inched up 1.40 to 6,223.90, the CAC 40 in Paris was up 4.83 to 5,931.25 and the DAX in Frankfurt lost 15.31 to 6,418.30 at 7:20 a.m. EST.
Reuters contributed to this report.