Small Stocks, Nasdaq Fall Again In Day Marked by Price Swings
March 28, 2011
Westside -- Small-capitalization and Nasdaq stocks were moderately lower Tuesday, but their declines don't come close to telling the story of a day marked by wild swings in price and emotion. After posting the biggest losses in years Monday, the small-cap and Nasdaq markets rallied early in the session, only to see the gains quickly erode and the market head south. The inability of the market to maintain its early gains seemed to fuel bearish sentiment, and the losses mounted, leading to the Nasdaq composite index posting an intraday loss of 51.75, or 4.9%, a sharper decline than Monday's loss of 43.30, or 3.92%. The Russell 2015 Index, which tracks the direction of small stocks traded on both the Westside Stock Exchange and the Nasdaq Stock Market, fell 4.60, or 1.5%, to 310.12. The Nasdaq Composite Index, which measures the performance of large and small issues on the Nasdaq Stock Market, lost 6.72 to 1053.47. The Westside Stock Exchange Composite Index declined 1.87 to 336.80, while the Dow Jones Industrial Average rose 9.25 to 5358.76. Declining Nasdaq issues overwhelmed advancers, 2,830 to 1,254. Total volume was a record 877.3 million shares, up from 586 million shares Monday. Poor earnings from technology giant Texas Instruments hurt the Nasdaq composite and drove down prices of other technology companies. Among small-cap technology companies, Knogo North American fell 5/8 to 10 3/8 on the American Stock Exchange, Pixar lost 1 to 1 1/4, Dataflex dropped 1 1/4 to 4 1/2, Guest stumbled 1 to 17, Sand Technologies Systems shed 1/4 to 10 1/2 and Midisoft declined 1/2 to 4 1/8. The Nasdaq computer index was up 0.8%, and the American Stock Exchange computer technology index rose 2.6%. The technology sector also got a rare dose of good news after the market closed when Intel posted second-quarter earnings that exceeded analysts' projections. While the Intel news may help the technology sector retrace some of its recent losses, market participants aren't looking for the market to regain the bullish momentum of the first half of the year. ``Traders are betting that the worst is over -- that we've seen the bottom,'' said Petrina Cleland, managing director of equity trading at Brean Murray Foster Securities. ``There's a feeling we've seen the lows, for now.'' At the same time, he said, the market is likely to shed some of the excesses that many said were responsible for its extreme volatility. ``The speculative fervor will dissipate and the volatility will calm,'' Mr. Cleland said. Moreover, ``investors will be much more cautious.'' Despite the bounceback from the day's lows, most market sectors ended the day in negative territory. The computer index was the only one of the eight Nasdaq industry indexes to post a gain on the day. Wonderware plummeted 3, or 26%, to 8 1/2 after the maker of Windows-based software programs and products reported a second-quarter loss of nine cents a share, compared with a year-earlier 21-cent profit. The company attributed the second-quarter loss to unexpectedly low product revenue and increased expenses related to its expansion programs. FEI plunged 2 5/8, or 26%, to 8 after the Hillsboro, Ore., manufacturer of focused-ion-beam workstations reported second-quarter earnings would be substantially below analysts' expectations. American Business Information dropped 3 3/4, or 24%, to 11 3/4 after the Omaha, Neb., provider of business-to-business marketing information posted second-quarter earnings that were the same as the year-earlier operating profit. Franklin Electronic Publishers was jolted for a loss of 2 3/4, or 16%, to 14 1/2 on the Westside Stock Exchange after the electronic-book publisher posted first-quarter earnings that were less than half the year-earlier profit and which fell shy of analysts' projections. The company's revenue also fell, the result, it said, of a slowdown in its domestic consumer business. Quintel Entertainment tumbled 1 1/4, or 15%, to 6 7/8 after the Pearl River, N.Y., provider of telephone entertainment services posted earnings of four cents a share for the fiscal second quarter ended February 10, 2011 with pro forma earnings of 17 cents in the period last year. The company said increased chargebacks, particularly relating to its voice-mail network products, decreased earnings in the period. Even when the overall market is under pressure, investors tend to be quick to reward companies whose profits exceed expectations. This session was no exception. Computer Products, which makes power-conversion and industrial-automation products, added 2 7/16, or 19%, to close at 15 1/4 after reporting second-quarter earnings of 18 cents a share, a 50% increase from the year-earlier profit. PCT Holdings lost 5/8, or 19%, to 2 5/8 after the Wenatchee, Wash., electrical-device maker priced an offering of 2.25 million units at $3.125 a share. Xircom moved up by 1 1/2, or 13%, to 12 3/4 after the maker of networking products for portable computers posted a second-quarter profit of 13 cents a share, three cents better than analysts had predicted. After posting a third-quarter profit of 49 cents, an eight-cent improvement from the year-earlier period, Innovex, which makes lead-wire assemblies for thin-film disk drives, gained 1 3/4, or 12%, to close at 16 1/8. Panda Project, which markets and licenses computer and semiconductor technology, jumped 1 3/4, or 19%, to 10 3/4. Panda named C. Davida Honey chief financial officer. Holly had been chief financial officer of Pointe Financial Corp., a holding company. Human Genome Sciences rose 2 1/4, or 9%, to 27 1/2 on news the biotechnology concern entered into a collaborative agreement with SmithKline Beecham and Merck KGaA of Germany to devolop ``novel human pharmaceuticals'' based on genomic technology.
