The Nasdaq Composite Index was headed lower at midday, erasing morning gainsas big-name technology stocks pulled the average down 8.27 to 2,599.55.
Among key Nasdaq stocks, Microsoft Corp. (Nasdaq: MSFT) was down $1.39 at$63.30 amid reports that Merrill Lynch analyst Henry Blodget had taken overcoverage of the stock from another analyst and reduced the company’slong-term investment rating to accumulate from buy.
Cisco Systems, Inc. (Nasdaq: CSCO), which helped drag the Nasdaq lower onWednesday with a weaker-than-expected quarterly financial report, resumedits plunge Thursday, falling 38 cents to $30.69 by midday. Chipmaker IntelCorp. (Nasdaq: INTC) was also lower.
EDS, Worldcom Rise
There were some bright spots in the technology sector, with a strongearnings report from Electronic Data Systems Corp. (NYSE: EDS) providing anearly lift to technology stocks. The Plano, Texas-based computer servicescompany said it signed a record $15.8 billion in contracts during the latestquarter, indicating there is some business out there for technologyservices.
Analysts at JP Morgan, Credit Suisse First Boston, Lehman Brothers andMorgan Stanley Dean Witter reportedly raised their ratings on EDS sharesafter the report. EDS was up $5.81 at $62.71 in midday trading.
Worldcom, Inc. (Nasdaq: WCOM) also rose after reporting quarterly resultsthat were in line with expectations. Worldcom shares were up 44 cents at$20.56 at midday after the long-distance telephone company said sales forthe fourth quarter ended December 31st edged higher, while net income fell.
E-Commerce Shares Gain
E-commerce shares were also mostly higher at midday, as brick-and-mortar chain retailers, in their monthly reports on sales, also reported increased business for January.
The E-Commerce TimesIndex was up 0.62 percent on the day.
Priceline.com (Nasdaq: PCLN) was up 25 cents at $2.94 after the companyrestructured its agreement with Delta Air Lines, Inc. The new agreementreduces Priceline’s expenses and allows Delta to take a bigger stake in thetroubled e-tailer.
Meanwhile, Barnesandnoble.com (Nasdaq: BNBN) was 24 cents lower at $1.88after reporting a loss for the fourth quarter and announcing a round oflayoffs.
Freemarkets, Inc. (Nasdaq: FMKT) rose $2 to $21.75 after the company, whichoperates a business-to-business (B2B) online marketplace, said it agreed to buyprivately held software maker Adexa, Inc. for stock worth about $340 million.
In economic news Thursday, the Commerce Department said wholesaleinventories were unchanged in December, while sales rose 0.7 percent. The Labor Department’s weekly report on unemployment claims showed a rise of 15,000to 361,000 in the week ended February 3rd.