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Date Posted: 17:15:35 11/18/00 Sat
Author: x
Author Host/IP: slip-32-100-192-230.in.us.prserv.net / 32.100.192.230
Subject: x

11/17/2000 Stocks End Down on Worries About Earnings

By Jack Reerink

NEW YORK (Reuters) - Stocks ended slightly lower on Friday as worries about dwindling corporate earnings overcame an early rally fueled by expectations the U.S. presidential election would be resolved this weekend.

In a scenario often repeated since polling day, stocks quickly shed their election-related gains. A judge after the close blocked officials from certifying the election results in the key state of Florida. That means a clear winner is unlikely to emerge this weekend.

During the session, investors sold telecom shares after BellSouth Corp. (NYSE:BLS - news), the No. 3 U.S. local telephone company, late Thursday confessed that growth would slow next year. The announcement hit the local Bells as well as telecom equipment makers, like Canada's Nortel Networks (NYSE:NT - news), which hit a new 52-week low.

``We are going to have a roller-coaster market until we get resolution of the election. The market will continue to trade back and forth based on the latest press conference,'' said Joseph DeMarco, managing director of stock of trading at HSBC Asset Management Americas. ``But corporate earnings are soft, so there is a net downward bias. It is a frustrating time right now.''

The technology-packed Nasdaq Composite Index (^IXIC - news) ended down 4.67 points, or 0.15 percent, at 3,027.21. The index earlier fell below the key 3,000 level, which it breached for the first time in more than a year on Monday.

The Dow Jones industrial average (^DJI - news) was down 26.16 points, or 0.25 percent, at 10,629.87, weighted down by BellSouth rival SBC Communications (NYSE:SBC - news).

The broader Standard & Poor's 500 Index (^SPX - news) fell 4.61 points, or 0.34 percent, to 1,367.71.

The market rallied in the morning after a Florida judge's decision opened the way for the state to certify its final vote count on Saturday. Whoever wins Florida, gets to move into the White House.

The electoral process has dragged on for more than a week and both candidates, Democrat Al Gore (news - web sites) or Republican George W. Bush (news - web sites), headed into the courts.

``We're still in a market bewitched by uncertainty,'' said Alan Ackerman, market strategist at Fahnestock & Co. ``The election uncertainty appears to be nearing a conclusion, but slower growth in the U.S. economy continues to prompt apprehension about what may happen to corporate earnings.''

That was clearly on traders' minds for much of the session.

BellSouth tumbled after saying that expenses related to entering the Colombian market and the Internet access business could bite deeply into 2001 earnings.

BellSouth closed down 14.5 percent, or $7-1/8, at $42-1/8 on the New York Stock Exchange (news - web sites). SBC closed down $2-1/16 at $56.

Telecom equipment firm Nortel Networks (NT.N) (Toronto:NT.TO - news) fell to a fresh 52-week low of $31-1/2, but recovered some of those losses to close at $34-1/16, down 3/8 on the NYSE.

The American Stock Exchange's North American Telecoms index (^XTC - news) dropped more than 4 percent.

Communications chip makers were battered again, a day after a downbeat assessment of future sales at equipment maker Applied Materials Inc. (NasdaqNM:AMAT - news) reignited fears of slowing earnings growth for the group. It blamed warnings of slower growth from mobile telephone makers for the anticipated shortfall.

Applied Micro Circuits Corp. (NasdaqNM:AMCC - news) lost $5-1/4 to $55-11/16, while Broadcom Corp. (NasdaqNM:BRCM - news) fell $11-1/2 to $133.

Talk of softer sales at Commerce One Inc. (NasdaqNM:CMRC - news) after the company distributed an internal memo to encourage its sales force slammed the business-to-business software company's shares. A Commerce One official denied the rumor.

The company's shares were off the day's low, but closed down $5-11/16 at $47-5/8.

Network equipment maker Juniper Networks (NasdaqNM:JNPR - news) was another major drag on the Nasdaq market, slumping $7-7/16 to $154-3/8.

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