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Sun shines on Nasdaq
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October 24, 2001: 6:37 p.m. ET
The Nasdaq climbs again -- but can it hang on? Meanwhile, the Dow holds steady despite depressing earnings.
Bethany McLean
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NEW YORK (CNNmoney) - TOMORROW, TOMORROW Earnings will come out, tomorrow. (OK, it's a little off-tune, but isn't everything these days?) And at least right now, we're betting our bottom dollar (plus lots of other dollars) that there will be more earnings tomorrow. Despite word from the Fed that 9/11 "sharply reduced" economic activity -- I think we knew that already -- and despite cries that the Nasdaq has rallied too far, too fast, it climbed another 27.10 today to 1,731.54. As for the dear old Dow, despite lots of depressing earnings news, it managed to hang onto a 5.54 gain, landing at 9,345.62. 'Til tomorrow!
STOCKS Sunshine in the tech sector! Citrix (CTXS: up $3.35 to $24.72, Research, Estimates), for one, climbed $3.35 to $24.72 after beating estimates, and Nextel (NXTL: up $1.29 to $8.69, Research, Estimates) shot up $1.29 to $8.69 after posting a 30 percent increase in revenues. Note to analysts: Easily achievable estimates are a really, really good thing. Appearances, it seems, do matter -- although some of us are having trouble keeping them up.
Amazon.com (AMZN: down $1.91 to $7.64, Research, Estimates), for instance, lost $1.91 to $7.64 -- 20 percent! -- after providing yet more proof that it is growth-challenged. (How's that for politically correct?) Merrill's Henry Blodget -- yes, he of the $400 price target -- finally downgraded the stock. "The company continues to make progress toward profitability, but revenue growth continues to decelerate," he wrote. Does this mean that customers don't want as much if you're not practically giving it away? Such a shock.
Speaking of results that are NOT as pretty as a picture, Kodak (EK: down $3.46 to $30.71, Research, Estimates) -- or eeeek!, as I like to call it -- tumbled $3.46 to $30.71 after warning AGAIN. How many does this make? And Travelocity (TVLY: down $5.83 to $14.07, Research, Estimates) dropped $5.83 to $14.07 after Continental said it would eliminate commissions for tickets bought online. Reminder! Dependence on a handful of big, powerful payers sucks!
Thank goodness for Honeywell (HON: up $0.69 to $28.29, Research, Estimates), which finally did something right by saying that fourth-quarter earnings would meet estimates. The stock gained 69 cents to $28.29.
ENRON Yes, Enron (ENE: down $3.38 to $16.41, Research, Estimates) is in a class by itself. Today, the stock plunged $3.38 to $16.41 -- touching levels not seen since the mid-1990s -- on a "sell" call by Prudential, not "because of things that we know but because of things that we potentially don't know," wrote analyst Carol Coale. Now there's a vote of confidence in management. A friend of mine also chalks Enron's steep slide up to the sudden realization (sometimes, the Street is oh-so-swift) that there's huge counterparty risk in all these companies. Which also means loss of confidence is a big, big deal.
Enron wanna-bes (or used-to-wanna-bes) like Dynegy (DYN: down $5.45 to $37.26, Research, Estimates) and El Paso (EPG: down $2.84 to $47.83, Research, Estimates) got whacked, too. (I hear El Paso may have some trouble selling an Enron-like off-balance sheet thingie that was in the works.) And after the close, Enron axed CFO Andy Fastow (he's taking a "leave of absence") -- I told you Friday that was coming. So much for Ken Lay's reassurances. Yesterday, we were told that he and the company's board "continue to have the highest faith and confidence in Andy." Today? See ya! But I'm not so sure making Fastow the fall guy is going to fix anything -- especially if counterparties and creditors continue to lose confidence in Enron.
JOBS, JOBS, JOBS Or no jobs, no jobs, no jobs. Bank of America (BAC: up $1.04 to $59.95, Research, Estimates) is saying goodbye to some 600 investment bankers -- ouch. Hershey's (HSY: down $0.01 to $64.00, Research, Estimates) says that it will cut 8 percent of its workforce and do some other restructuring stuff. Am I the only one out there doing my duty, eating chocolate in order to help Hershey's earnings? Sears (S: up $0.52 to $38.31, Research, Estimates), which is quickly discovering that it's a Kohl's kind of world, says it's cutting 4,900 jobs. Maybe they can all get jobs at Lilly, which says that it's looking to add 5000 sales reps over the next three years.
LOOSE CHANGE
Hello, government! Bayer announced today that it has agreed to sell the US government heavily discounted Cipro -- $95 million worth. But is anyone looking into Bayer's deal with Barr, whereby Bayer pays Barr some $30 million a year not to sell Cipro? Speaking of the government, where's that FTC investigation? Barr (BRL: down $3.85 to $75.70, Research, Estimates) shed $3.85 to $75.70 -- investors who were hoping that Barr would be authorized to sell Cipro were disappointed.
AT&T and its progeny...has anyone done the math? I'd love to know just how many dollars Avaya, Lucent, and AT&T have lost, either in write-offs or in market cap. More today! Ma AT&T (T: down $1.36 to $16.34, Research, Estimates) did its part, shedding another $1.36 to $16.34 today on icky earnings; Avaya (AV: down $1.30 to $10.60, Research, Estimates) contributed by dropping $1.30 to $10.60 on the same. And lovely Lucent (LU: down $0.05 to $6.59, Research, Estimates) fell 5 cents to $6.59. "I think we're near the bottom, but we could stay there for a while," said Avaya CEO Don Peterson in a Reuters interview. Now, that's encouraging.
Speaking of jobs, Jack Welch has yet another new one: He's going to be an advisor to JP Morgan Chase (JPM: up $0.46 to $36.22, Research, Estimates). Reuters says Welch's duties will be to "help develop managers and an integrated culture at JP Morgan." JP Morgan added 46 cents to $36.22.
A plea from my colleague Julie Schlosser to Teresa Pan. "I've been trying to track her down for a few weeks. She and her husband started a company called E-TEK. JDSU eventually bought it and now it is rumored that she runs Pan Communications. I would like to hear from her or someone who knows her."
Did Lending Tree (TREE: up $0.10 to $4.45, Research, Estimates) really belong on Fortune's "Dotcom Deathwatch"? Maybe not. Today, Lending Tree blew by estimates; the company still says it expects profitability soon. Lending Tree gained 10 cents to $4.45. 
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