Stock Watch: On the Road to Recovery — or Not
Posted: 2/2002
Stock Watch
On the Road to Recovery — or Not
Although the positive economic news was scarce during the session that ended Dec. 17, investors were betting recovery is coming soon.
Among the good tidings leading into the end-of-year holiday season were two reports that analysts say could telegraph a recovery. The National Association of Purchasing Managers’ (www.napm.org) survey of the services sector rose to 51.3 in November from 40.6 in October. That figure was well above estimates. And, outplacement company Challenger, Gray & Christmas’ (www.challengergray.com) report on layoffs indicated that job cuts totaled 181,412 in November, down 25 percent from October.
Despite the positive news, a couple of government reports were not so rosy. The U.S. Department of Labor (www.dol.gov) reported the unemployment rate in November reached its highest level in more than six years. The jobless rate shot up to 5.7 percent, with 331,000 jobs lost. At the same time, the Commerce Department (www.doc.gov) reported retail sales in November fell 3.7 percent, the largest monthly drop since 1992.
Even so, from mid-November to early December, the Dow Jones industrial average and the Nasdaq composite index posted gains. The PHONE+ Stock Index slipped, however.
The Dow Jones industrials edged up 0.2 percent, closing at 9891.97. The tech-heavy Nasdaq rose 4.57 percent to 1987.45. The PHONE+ Stock fell 3.20 percent to close
at 1876.68.
Among the big losers was Cable & Wireless
plc, (www.cw.com) which shed $2.05, or 12.28 percent, to close at $14.65. This could have been prompted by its announcement that it would buy troubled web-hosting firm Exodus
Communications Inc. C&W will pay about $850 million in cash for Exodus’ U.S., Japanese and European customer contracts along with 30 data centers and the Exodus brand. Exodus, (www.exodus.com) is currently in Chapter 11 bankruptcy.
Level 3 Communications Inc. (www.level3.com) also took a hit during the period. Its shares fell $1.28, or 18.60 percent, to $5.60.
On the plus side, was telecommunications services provider IDT Corp., (www.idt.com) whose shares rose $3.48, or 28.04 percent, to $15.89. Investors have been pushing up IDT’s share price steadily since mid-October.
Phone Top 10 Percentage Gainers |
11/15/0 Close ($) |
12/17/01 Close ($) |
Net Change ($) |
Percent Change (%) |
|
Teletouch Communications Inc. |
0.23 | 0.44 | 0.21 | 91.30 |
| ITXC Corp. |
4.43 | 6.45 | 2.02 | 45.60 |
| Vocaltec Communications Ltd. |
1.94 | 2.75 | 0.81 | 41.75 |
| Electric Lightwave Inc. |
0.30 | 0.39 | 0.09 | 30.00 |
| IDT Corp. | 12.41 | 15.89 | 3.48 | 28.04 |
| Adelphia Business Solutions Inc. |
0.42 | 0.52 | 0.10 | 23.81 |
| US Lec Corp. |
4.60 | 5.60 | 1.00 | 21.74 |
| Capsule Communications Inc. |
0.60 | 0.70 | 0.10 | 16.67 |
| ITC^Deltacom Inc. |
0.71 | 0.81 | 0.10 | 14.08 |
| Motient Corp. | 0.37 | 0.42 | 0.05 | 13.51 |
| Top 10 Percentage Losers | ||||
| Globstar Telecom Ltd. |
0.65 | 0.15 | -0.50 | -76.92 |
| Aquis Communications Group Inc. |
0.03 | 0.01 | -0.02 | -56.67 |
| McLeodUSA Inc. |
0.74 | 0.37 | -0.37 | -50.00 |
| Arch Communications Group Inc. |
0.03 | 0.02 | -0.01 | -47.24 |
| Metromedia Fiber Network Inc. | 0.70 | 0.47 | -0.23 | -32.86 |
| RCN Corp. |
4.18 | 2.82 | -1.36 | -32.54 |
| Level 3 Communications Inc. |
6.88 | 5.60 | -1.28 | -18.60 |
| Microcell Telecommunications Inc. |
2.44 | 2.06 | -0.38 | -15.57 |
| Primus Knowledge Solutions Inc. |
0.70 | 0.60 | -0.10 | -14.29 |
| Cable & Wireless plc | 16.70 | 14.65 | -2.05 | -12.28 |
|
Indices |
11/15/01 Close |
12/17/01 Close |
Net Change |
Percent Change |
| PHONE+ Stock Index | 1938.72 | 1876.68 | -62.04 | -3.20 |
| Service Provider Index | 1631.55 | 1599.76 | -31.78 | -1.95 |
| Dow Jones Industrial Average | 9872.39 | 9891.97 | 19.58 | 0.20 |
| S&P 500 Stock Index | 1142.25 | 1134.36 | -7.89 | -0.69 |
| NASDAQ Composite Index | 1900.59 | 1987.45 | 86.86 | 4.57 |
| NYSE Composite Index | 579.79 | 575.85 | -3.94 | -0.68 |
| Market Diary: | |
Advances: |
47 |
Declines: |
54 |
| Unchanged: | 6 |
Source: CNET Investor (investor.cnet.com) Boulder, Colorado. This information is based on sources believed to be reliable, and while extensive efforts are made to ensure its accuracy, no guarantees can be made. CNET Investor assumes no liability for any inaccuracies.
