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CNNfn market movers
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January 28, 1999: 2:34 p.m. ET
Carmakers grind gears while CMGI, other Nets say Yahoo! and Exodus soars
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NEW YORK (CNNfn) - Wall Street got back to basics on Thursday, as investors concentrated on a barrage of earnings reports and a handful of mergers and high-profile acquisitions.
Stocks in the automotive sector had a mixed reaction to news that Ford (F) had bought Volvo 's (VOLVY) car unit for $6.4 billion, indicating a renewed interest in global strategy that could spur more consolidation to come.
German-U.S. rival Daimler-Chrysler (DCX), which was created in a similar burst of Transatlantic thinking last year, surged 1-3/8 to 103-1/8.
However, perceptions that General Motors (GM) could be left behind in the global consolidation sweepstakes pushed GM shares down 15/16 to 92-7/16.
Auto-part makers were also sharply mixed in the wake of intensifying competition between TRW (TRW) and Federal-Mogul (FMO) over UK manufacturer Lucas-Varity (LVA).
New York receipts of Lucas-Varity gained 1-1/16 to 47-3/4, but TRW was up a scant 1/8 at 51-1/4 on a threat that rating agency Moody's Investors Service may downgrade the company's debt.
Shares of recently-spurned Federal-Mogul, still in the race as a potentially hostile bidder, slid 1-13/16 to 58-3/8.
A smaller deal between two regional banks produced one of the session's major advancers, Mason-Dixon Bancshares (MSDX). Mason-Dixon shares climbed 19-3/16 to 46-15/16 on news that it will merge with fellow banker BB&T (BBT) for $256 million in stock.
Cheer spreads for online wedding party
The big news in the Internet sector was the $3.6 billion Internet marriage of Web portal Yahoo! (YHOO) and "online community" Geocities (GCTY), which spurred already-fervid interest in Net stocks to a new pitch.
Shares of competing portals and community Web sites alike soared.
From the portal pews, Excite (XCIT) was up 5-1/3 at 112-3/4, basking in the lingering glow of its own recent merger with @Home (ATHM).
Infoseek (SEEK) gained 7-1/4 at 78-11/16 ahead of its earnings release due later in the day, while Lycos (LCOS) climbed 8 to 119-1/2.
Among the Internet community stocks, Xoom.com (XMCM) climbed 10-7/16 to 50 and theglobe.com (TGLO) rose 9-5/8 to 49-1/8, both in heavy early volumes.
One of the day's unsung winners was Internet venture capital firm CMGI (CMGI), which had owned a 29-percent stake in Geocities and so was effectively giving the bride away. CMGI shares surged 11-3/4 to 114-1/4 as canny investors realized that the company now owns 4 million shares of sector superstar Yahoo!.
Earnings give . . .
Swedish telecom maker Ericcson (ERICY) climbed 1-1/4 to 26-7/16, despite a 3-percent drop in fourth-quarter income.
Traders said the company had been so gloomy about its results in recent months that the market's expectations were already quite low, making the actual release something of a relief by contrast.
Dow Chemical (DOW) also benefited from the honest approach, gaining 1-13/16 to 88-13/16 after warning investors that 1999 will be a "challenging" one for the company. The chemical giant also posted lower but still market-surprising earnings of $1.10 for the quarter.
Another firm seeing operating losses but stock market gains was telephone firm CIDCO (CDCO). Shares climbed 1 to 4-1/4 even though the company posted a net fourth-quarter loss of 34 cents per share - a vast improvement compared to a loss of $2.51 per share a year ago.
On the brighter side, Readers Digest (RDA) gained 1-3/16 to 30 on the strength of earnings and encouraging progress in its corporate restructuring program.
A stock split and favorable comments from a market analyst drove investors to shares of Internet software company Exodus Communications (EXDS), pushing the stock up 8-15/16 to 95.
In response to the 2-for-1 split, BancBoston Robertson Stephens analyst Rick Juarez said, "Exodus has quickly moved from category killer to category gorilla."
. . . Earnings take away
On the other hand, Wall Street punished Internet service provider Mindspring (MSPG) for reporting earnings that were in line with analyst estimates, pushing shares down 3 to 106-3/4.
Mindspring shares climbed 22 percent between Monday and the Wednesday close as forecast-beating profits from America Online and other Internet companies primed the market to expect nothing but the best from the online sector.
Among other companies who fell out of Wall Street's favor when their earnings fell short the mark, Callaway Golf (ELY) dropped 5/8 to 10-5/8, automation software firm Vantive (VNTV) slid 15/16 to 13-11/16 and programmer Inprise (INPR) lost 27/32 to 5-13/32.
Promotional firm HA-LO Industries (HMK) suffered one of the day's worst declines, falling 10-15/16 to 24-1/2 after Credit Suisse First Boston cut the stock's investment rating from "strong buy" to "buy" due to perceived oversaturation in the telemarketing field. 
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