Nasdaq Goes From Bad to Worse

May 10 2000

The Nasdaq today suffered its third and worst loss of the week, dropping nearly 6 percent, or 199.94, to close at 3385.07. The index now hovers dangerously near its lowest mark for the year . The Dow suffered a fall as well, faltering slightly from its steady position. It was down 1.6 percent, or 168.97, to close at 10367.78.

Reasons for the losses are debatable, but analysts generally cite increasing investor skepticism about the future growth of Internet and technology companies. Even positive growth outlooks have been unable to stem investor flight. Indeed, though Cisco Systems announced strong earnings yesterday and beat Wall Street estimates by a penny, those results were not enough to mollify investors today. Cisco fell 6 percent, to close at $58.68.

In like manner, a strong vote of confidence from IBM CEO Lou Gerstner did little for investors in Big Blue. Though the chief executive proclaimed the company's core businesses to be "back on track," the stock fell 6 percent to close at $102.93.

Cisco and IBM were joined by other large-cap techs today. Intel plunged 9 percent to $106.05, and Oracle was down 6 percent to $67.81. Sun Microsystems lost 5 percent to $77.75. Hewlett-Packard dropped 5 percent to close at $125.31.

The Internet sector continued to suffer. EBay lost 9 percent today to $111.06. Amazon.com dropped 5 percent to $53.25, and DoubleClick lost 9 percent to $49. Interwoven fell 12 percent to $51.87, and JDS Uniphase lost 6 percent to $80.18. Yahoo bucked the trend today, rising a slight 1 percent to close at $118.75.

The Dow sagged under losses by Microsoft , down 2 points to $66.18, and by ATT , which dropped 4 percent to $36.25. But it had large and strong gains in Old Economy stocks today, with Wal-Mart gaining nearly 7 percent to $103.93, and Coca-Cola rising 5 percent to $52.93. Exxon-Mobil was up nearly 3 percent today to close at $81.43.