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CNNfn market movers
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January 14, 1999: 2:18 p.m. ET
Internet ties not enough for JetFax; disk makers Seagate, WDC slide
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NEW YORK (CNNfn) - Thursday's unsteady trading spawned a dramatically mixed batch of market-driving stocks, with the technology sector providing the bulk of both volatility and breaking news.
Disk-drive makers slid narrowly lower in impressive trading volumes, although Iomega (IOM) edged up 1/8 to 9-1/8 as investors anticipated profits ahead for the company after a year in the red.
Western Digital (WDC) drifted down 1/16 to 20-5/16 despite trading higher at the open. Traders said the market was having a hard time making up its mind on the company, which announced overnight that it is "reviewing" its Singapore operations without making a firm decision on the fate of its production facilities there.
Seagate Technology (SEG) led the sector's retreat, falling 1-5/16 to 40-5/16 as investors took profits made during the company's recent profit-fueled rally.
Software companies were equally mixed. Rational Software (RATL) jumped 3-1/2 to 30-1/16 after beating Wall Street earnings estimates, but banking software supplier Phoenix International (PHXX) plunged 4-1/2 to 10-1/8 after warning of disappointing profits ahead.
Data Broadcasting (DBCC), which provides financial information, slipped 3/4 to 31-7/8.
Traders said the market was taking profits from DBCC's recent rally, which saw shares leap 50 percent ahead of a public offering of its CBS (CBS) joint Internet venture Marketwatch.com.
Internets in retreat
However, the Marketwatch offering could suffer from gathering sentiment that the Internet bubble may be close to bursting.
Shares of all major Internet portal companies - one of the sector's primary bulwarks - were lower after two finance firms expressed concerns that online companies may be overvalued.
Deutsche Bank analyst Alan Braverman downgraded his recommendations on Lycos, Yahoo! and Excite to "accumulate" from "buy" late Wednesday, while Jefferies & Co. cut its Yahoo! rating to "hold" from "buy."
Excite (XCIT) weathered the news best, slipping 5/8 to 68-3/4. Yahoo! (YHOO) fell 7-5/8 to 360-3/8 and Lycos (LCOS) shed 9-7/8 to 87-1/16.
Even though Infoseek (SEEK) was not explicitly mentioned in either downgrade, shares in that company fell 1-5/16 to 74-1/4.
Wall Street also displayed an uncharacteristic twinge of caution in bestowing rewards on companies associating themselves with the Internet.
Rather than embrace fax maker JetFax (JTFX) for changing its name to eFax.com and expanding its Net presence, investors punished the company for warning of a fourth-quarter loss ahead. Shares tumbled 1-5/16 to 3-5/8.
Educational software maker MathSoft (MATH) still managed to reap the benefits of increased Internet exposure, with shares surging 1-3/16 to 5-7/8 after the company announced a marketing alliance with online retail superpower Amazon.com (AMZN).
Sunglass Hut (RAYS) also banked on residual Internet optimism, up 1-15/16 at 9-5/16 after buying closely-held Web retailers shades.com and SwissArmyDepot.com.
Morgan Stanley Dean Witter raised its rating of the company's shares - which climbed as high as 11-1/2 in heavy morning trading -- to "strong buy" from neutral."
Broader market broadly lower
Among non-technology companies, gently falling stocks were the general order of the day, although there were still some standouts among both declines and advances.
Dental supplier Zila (ZILA) fell 11/32 to 5-1/32 after the Food & Drug Administration voted not to approve the company's OraTest mouthwash aimed at oral cancer detection.
Pharmaceutical maker Schering-Plough (SGP) had a happier time with the FDA, winning official support for its product Temodal, a brain cancer drug. Schering-Plough shares inched forward, gaining 3/8 to 51-1/2.
Planet Hollywood (PHL) also crawled ahead, up 3/8 at 3 after announcing another cost-cutting program designed to keep the dwindling favor of investors.
Shares in troubled publisher Golden Books Family Entertainment (GBFE) leapt 1-1/8 to 1-7/8, a 150 percent gain, on comments from Walt Disney Chairman Michael Eisner that Disney (DIS) might buy the company.
As usual, investors were generous to companies that reported old-fashioned firm profits.
Party retail chain Party City (PCTY) climbed 15/16 to 34-3/8 on the strength of dramatically higher fourth-quarter earnings, while regional U.S. bank First Union (FTU) also beat the forecasts and pleased Wall Street, gaining 1/2 to 62-15/16.
On the downside, health-food grocery operator Whole Foods Markets (WFMI) joined the list of companies warning of sagging profits ahead. The company told Wall Street late Wednesday that fiscal first-quarter earnings would drastically disappoint analyst forecasts of 58 cents per share.
Whole Foods shares plunged 9-3/8 to 35-1/8. 
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