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Software industry

Market Lacks Conviction as Nasdaq Composite Falls

Strategic Insights

— 1 min read

Market participants remained cautious yesterday, with most of the usual movers lacking force in recent weeks. The Nasdaq composite index fell 9.51 points, to 729.79, driven by a rout in computer stocks ahead of a release of a computer-industry indicator today. The Dow Jones industrial average and Standard & Poor's 500 also fell, while the New York Stock Exchange saw below-average trading volume.

Key Takeaways:

  • The Nasdaq composite index fell 9.51 points, to 729.79, due to a rout in computer stocks.
  • The Dow Jones industrial average fell 6.46 points, to 3,749.45, while the Standard & Poor's 500 fell 1.15 points, to 457.06.
  • Computer software developers like Microsoft and Oracle, hardware companies like I.B.M. and Compaq, as well as semiconductor companies like Intel and Motorola all fell.
  • The Most Active Stock was Microsoft, with 12.7 million shares traded, which fell 1 5/8, to 52 yesterday.
  • Merisel Inc., a major distributor of personal computers, fell 6 3/4, to 10, after citing lower demand and thinner profit margins.
  • Wall Street analysts expect the Semiconductor Industry Association's book-to-bill ratio to be about 1.12, down from 1.14 in April.
  • The hardest-hit group was the computer industry, which is speculated to be hurt by a slowing economy.
  • Traders are speculating on how a slowing economy would hurt sales of computers and the related demand for software.

Statistics:

  • The Nasdaq composite index fell 9.51 points, to 729.79.
  • The Dow Jones industrial average fell 6.46 points, to 3,749.45.
  • The Standard & Poor's 500 fell 1.15 points, to 457.06.
  • The New York Stock Exchange saw below-average trading volume, with 256 million shares changing hands, or 14 percent below this year's average of 297 million shares.
  • Volume on the Nasdaq was below normal, with 411 million shares traded, or 10 percent below this year's average of 457 million shares.
  • Microsoft, the world's largest software company, was the most active stock, with 12.7 million shares traded.
  • Merisel, a major distributor of personal computers, was the second-most-active stock, with 8.8 million shares traded.

Sources:

  • The Wall Street Journal, Thursday, August [no date mentioned]
  • Alex. Brown & Sons
  • Nasdaq/OTC trading

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