Technology stocks remained battered at Monday's market close, while blue chip shares ended the session modestly higher.
According to preliminary calculations, the Nasdaq composite
index fell 141.27 to close at 4,907.35. The index fell as much as 209.36 points shortly after the opening bell.
Analysts attributed the wave of selling to investors eager to
lock in profits from the Nasdaq's sharp rise this year. The index,
dominated by technology stocks, was up 24 percent as of Friday's
close, and even after today's selloff, is up 21 percent since the
start of 2000.
Other market indicators fared better. The Dow Jones industrial average rose 18.31 to 9,947.13, having recovered from a loss of as much as 190.49 points, or 1.9 percent, within minutes of the
opening of trading.
"We're seeing the reflection of investors' nervousness, but
overall, the outlook remains strong," said John Shaughnessy, chief
investment strategist at Advest Inc. of Hartford, Conn.
Stocks fell steeply at the opening bell, after financial markets in Asia and Europe dropped sharply.
Leading the decline was Japan's Nikkei stock average, which fell 2.8 percent after the Japanese government announced the economy
shrank more than expected in the last quarter of 1999. It was the
second consecutive quarterly decline of the gross domestic product,
meaning the economy was technically back in recession.
Investors had hoped that an economic recovery in Japan would
compensate for any slowdown in the United States in the coming
The downturn in Asian markets set off selling in Europe too.
Britain's FT-SE 100 was down 1.5 percent, Germany's Xetra DAX index
fell 3.5 percent and France's CAC-40 fell 2.7 percent.
European analysts also cited profit-taking, noting that
high-flying media, telecommunications and technology shares were
most severely affected.
"Mondays always seem to have a dampening effect, particularly
after a good week," said Ken Joseph, director of European sales
trading at Credit Lyonnais in London.
On Wall Street, technology shares that have performed the best this year were falling. Qualcomm, Oracle and 3Com all fell.
"There was a lot of chatter over the weekend on the Wall Street (television) shows about the impending doom of the Nasdaq," said
Brian G. Belski, chief investment strategist at George K. Baum &
Co., in Kansas City, Mo. "The market by virtue of its recent
ascent, especially the Nasdaq, has set itself up for a bit of a
A few high-profile technology stocks were climbing today. Intel and Dell both rose in heavy Nasdaq trading.
Among Dow components, Times Mirror, publisher of the Los Angeles Times, soared 37.68 to 85.625 on the New York Stock Exchange after Tribune Co., publisher of the Chicago Tribune, agreed to acquire it for $6.46 billion. The combined company would have 11 daily newspapers, 22 television stations, magazines such as Popular Science, and four radio stations.
Tribune shares fell 6.44 to 30.75.
The Associated Press and Reuters contributed to this report