MARKET PREVIEW: Techs to await Greenspan

2 min read

More good earnings news should keep markets calm ahead of Alan Greenspan's semiannual Humphrey-Hawkins report. Asia and Europe were down, and the Dow is set to open slightly lower.


Earnings reported by two big Internet A-names after the bell Wednesday could aid the markets in their slow recovery from Tuesday's lows. The nation's biggest Internet service provider America Online Inc. (NYSE: AOL) posted fourth-quarter profits twice as high as last year's results, and beat the Street by two cents by pulling 13 cents a share. Online retailer Amazon.com Inc.(Nasdaq: AMZN) also made the grade in terms of expectations. It reported a loss from operations of $82.8 million, or 51 cents per share in the second quarter.

Fed watchers will have their ears perked for clues as to what interest rates will do at the policymakers' meeting in August as Greenspan gives his Humphrey-Hawkins report before Congress today. The 1978 Humphrey-Hawkins Act calls for this report that enables the Fed to target an economic or market indicator to justify its monetary policy. The Fed is still eyeing rising stock prices as a sign of inflation. Investors hope the Fed will shift interest rate policy to be more in line with the belief that a new era of high-tech growth enables the economy to grow without creating inflation.

Also, the Labor Department will release data on weekly unemployment claims Thursday morning, which are expected to have risen slightly, to 315,000.

Expect the following technology stocks to be among Thursday's most actively traded issues: Amazon.com Inc. (Nasdaq: AMZN, America Online Inc. (NYSE: AOL), Ariba Inc. (Nasdaq: ARBA), Go2Net Inc. (Nasdaq: GNET), Preview Travel Inc. (Nasdaq: PTVL), Silicon Graphics Inc. (NYSE: SGI) and Skytel Communications Inc. (Nasdaq: SKYT).

Technology stocks made a spirited recovery Wednesday as solid earnings reports from leading bellwethers sparked a lukewarm rally. The Nasdaq closed up 29 points to 2,761.66 while the Dow added 7 points to 11,002.78.

At the Bell

The Dow Jones industrial average may slide about 28 points lower. The Standard & Poor's 500 index for June futures contracts was down 3.5 points to 1382 at 7:42 a.m. EST in 24-hour electronic trading.

The Inter@ctive Week @Net Index rose 5.35 to 306.09.


Trading in Asia was down. The Nikkei 225 fell 2.89 percent to 17,730. Singapore's Strait Times index lost 1.40 percent to 2,067 and Hong Kong's Hang Seng dipped 0.38 percent to 13,369.


European markets were also moving down. London's FTSE 100 sunk 0.21 percent to 6,316. The CAC 40 in Paris shed 1.14 percent to 4,449 and the Xetra DAX in Frankfurt fell 0.95 percent to 5,362 at 6:50 a.m. EST.

Reuters contributed to this report.