Stock Watch – Market Reverses After Tech Stocks Are Clobbered
Posted: 05/2000
Market Reverses After Tech Stocks Are Clobbered
In a sudden reversal of fortunes, investors flocked to “old money” stocks and disdained “new money” ventures that have been Wall Street’s darlings for much of the new millennium.
“There is a flight to quality,” explains Charles Payne, head analyst at Wall Street Strategies
(www.wstreet.com).
The Nasdaq Composite crumbled after closing at record levels. Also, the broader market was calmed after the release of data that showed February retail sales rose slightly higher than expected, muting fears of aggressive rate hikes by the Federal Reserve.
The Dow Jones Industrial Average’s gain on the last day of our trading session was the biggest gain since October 1998, but it was not enough to make up for earlier losses. The Dow ended down 586.68 points, or 5.47 percent, to close at 10131.41. In contrast, the PHONE+ Stock Index moved forward, gaining 225.87 points, or 4.60 percent, ending at 5138.91.
Advanced Radio Telecom
(www.art-net.net) surged ahead after being initiated with positive ratings by two brokerages. Robertson Stephens analyst Jim Friedland started the company with a “buy” rating, noting, “Advanced Radio Telecom provides telecom carriers, such as application service providers, Internet service providers, and competitive local exchange carriers, with broadband access to buildings that are beyond the reach of fiber.”
He added, “Given that only 3 percent of office buildings in the U.S. are wired with fiber, we believe the opportunity is substantial. In addition to its San Jose operation, the company plans to launch service in 10 U.S. markets in 2000.”
Aerial Communications Inc.
(www.aerial1.com) was punished this month, losing 14.94 points, or 21.77 percent, to close at $53.69. The company gained approval from its shareholders to merge with VoiceStream Wireless Corp.
(www.voicestream.com), which also is completing a merger with Omnipoint Corp.
(www.omnipoint.com).
