Tech stocks struggle in quiet trading


Associated Press

NEW YORK – Blue chip stocks moved higher today but technology issues lagged behind in one of Wall Street’s quietest sessions in recent weeks. Many investors stayed on the sidelines, resting after a week of hectic buying and selling.

The market was uninspired by news of the $45 billion merger between General Electric and Honeywell. Even Lucent Technologies failed to move investors, despite warning again of weak earnings, firing its CEO and reporting slightly better-than-expected third-quarter results.

The Dow Jones industrial average closed up 45.13 at 10,271.72, after a 133-point rally in the morning failed to hold.

Broader indicators were lower. The Nasdaq composite index fell 14.45 at 3,468.69. The Standard &Poor’s 500 index fell 1.15 to 1,395.78.

“The market is pausing for a breath after its big recovery Wednesday and rallies on Thursday and Friday,” said Dick Dickson, a technical analyst at Scott &Stringellow Inc. “Frankly, I’m surprised the market’s not off more than it is.”

Investors woke to the news that GE was buying Honeywell for $45 billion in stock. Both companies are Dow components. GE fell $2.52 to $49.98, while Honeywell rose $2.75 to $49.75, but the news had little, if any, impact on other stocks.

Third-quarter earnings, responsible for the market’s plunge and recovery last week, also generated little excitement.

Shares of 3M climbed $2.56 to $89.81 after the manufacturing company’s quarterly earnings per share beat Wall Street estimates by a penny. Optical networking company Corning also came in ahead of analysts’ estimates by 1 cent, but investors punished its shares. They dropped $7 to $99.

Concern about Lucent did not appear to be driving the market. The telecommunications company’s stock rose 56 cents to close at $23.19 in regular trading, before gaining another 25 cents on news it modestly beat Wall Street’s previously reduced expectations for third-quarter profits.

Lucent has warned of weak earnings four times this year, and analysts said its stock price reflects those problems.

Microsoft lost $3.06 to $62.13 as traders took profits after last week’s positive earnings report.

Analysts weren’t worried about the mixed trading, saying the respite was expected after last week’s intense activity.

“We’re getting into the good profit news, valuations have become considerably more attractive … and the tax law selling season is about over,” said Tom Galvin, chief equity strategist at Donaldson, Lufkin &Jenrette. “I think the cash on the sidelines is wanting to come back in to work.”

Declining issues outnumbered advancers by a ratio of 13 to 10 on the New York Stock Exchange, where volume came to 1.02 billion shares, compared with 1.29 billion in the previous session.

The Russell 2000 index rose 2.51 to 489.96.

Overseas, Japan’s Nikkei stock average fell 0.66 percent. Germany’s DAX index was up 0.40 percent, Britain’s FT-SE 100 up 0.63 percent, and France’s CAC-40 slipped 0.54 percent.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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