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CNNfn market movers
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June 24, 1999: 2:44 p.m. ET
Rumors propel stocks upward as two new tech shares have banner day
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NEW YORK (CNNfn) - Despite a sell-off in the broad market, some merger plays rose on a whisper and a prayer Thursday afternoon as investors blessed some unions, hoped for others and applauded the market's newest technology issues.
Mergers, or the mere idea of a merger, swirled around most of the afternoon's hottest shares, particularly in the technology sector where patrons found much to talk about.
The thinly traded Data Processing Resources (DPRC) saw its volume surge after the information technology staffing company agreed to be acquired by software maker Compuware Corp. (CPWR) for $24 per share. Data Processing shareholders quickly crunched the numbers, sending the firm's shares up 11-1/8, or more than 90 percent, to 23-3/8.
Omnipoint Corp. (OMPT) had investors scanning wireless phone company stocks after announcing a merger agreement with VoiceStream Wireless Corp. (VSTR) late Wednesday, creating one of the nation's biggest wireless communications companies. Omnipoint shares got right to the point, climbing 8-3/16 to 29, while VoiceStream's stock encountered a bit more static, falling 13/16 to 28-11/16.
Other industries capitalized on merger deals as well. Investors sucked up shares of Vacu Dry Co. (VDRY) after the industrial ingredients supplier agreed to sell its apple-based industrial business to Tree Top Inc. for $12 million, sending its shares up 2 to 9-3/4.
But when there weren't actual deals to talk about, there were plenty of rumors around to energize stocks.
Nalco Chemical Co. (NLC), for one, was smelling sweet to investors after rumors persisted the company was in merger talks, sending its shares up 2-3/8 to 39-5/8.
Compaq Computer Corp. likewise powered its shares after confirming it is considering giving Internet investment firm CMGI a controlling interest in its AltaVista search engine. Compaq (CPQ) shares slipped 13/16 to 22-5/8 by mid-afternoon, while CMGI (CMGI) shed 1-11/16 to 97-1/4.
Investors took a different tack, however, when it came to Lycos Inc. (LCOS), after reports that search engine also had discussed a union with CMGI. Lycos shareholders took heart in the possible, if not stalled, deal, sending the company's stock up 2 to 95-1/2.
IPOs see strong first day
The market's newest players were hardly ignored Thursday. Cybersource Corp. (CYBS), the electronic commerce transaction services spin-off from Beyond.com, rose more than 26 percent to 13-7/8 on its first day of trading after pricing four million shares at $11 per share.
And Software.com (SWCM), an Internet software company, rose nearly 31 percent to 19-5/8 after pricing six million shares at $15.
Elsewhere on the Internet, investors sprang into action after Mindspring Enterprises Inc. (MSPG), the world's No. 4 Internet access provider, announced it is in discussions about possible business combinations. Mindspring's stock was up 2-1/8 to 80-3/4 on the news.
And few were willing to split hairs over Tektronix Inc. (TEK) after the company announced it would divide into two publicly traded companies, sending its shares up 2-3/16 to 28-3/4.
On the earnings front, Zomax Inc. (ZOMX) rose 7-13/16 to 35-3/8 after the CD and cassette tape maker said its second quarter earnings will be as much as 24 cents above analysts' expectations.
But investors showed little patience for those falling short of expectations. Among those down in afternoon trade included Micron Technology (MU), down 3-3/4 to 40-3/16 after reporting a third quarter loss of 10 cents per share, and Global Vacation Group (GVG), down 1-13/16 to 4-3/16, after announcing it would fall 13 cents to 15 cents below analysts' second quarter earnings expectation of 17 cents per share.
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