Yahoo led the charge when its stock jumped this morning after three brokerage firms raised their investment recommendations for the leading portal a day after it reported strong earnings that exceeded Wall Street's expectations.
The portal surged 10.31 to 186.06, helping drive the Nasdaq Composite Index up 18.45 to 2,875.66. The Dow Jones Industrial Average slipped 18.05 to 10,570.29, and the CNET Tech Index edged 5.5 points higher to 2,239.66.
"We are looking for a strong [fourth quarter from Yahoo], driven in part by a potentially solid holiday e-shopping season and also by new users coming online," PaineWebber Internet analyst James Preissler wrote in a report this morning.
"We believe Yahoo is making a transition from an e-commerce model that focuses on hosting merchant sites to one that increasingly monetizes transactions, and thus we expect e-commerce revenues to increase as a percent of total revenues," he added.
Deutsche Banc Alex Brown raised its outlook on Yahoo to a "strong buy" from "buy," while other investment banks, including US Bancorp Piper Jaffray, PaineWebber, and Lehman Brothers, increased their expectations for Yahoo's fourth-quarter revenues.
Most Internet stocks basked in the glow from Yahoo's momentum. America Online gained 3.13 to 123.13, Excite@Home climbed 2.56 to 49.13, and Lycos rose 1.19 to 65.31.
Net losers included About.com, which shed 4.75 to 49.13. Barnes & Noble slipped 3.25 to 23.25 after the company acquired Babbage's Etc., a computer software and video game seller, for $215 million.
Shares of BMC Software tumbled 5.13 to 64.88 after the company said it anticipated fiscal second-quarter profit would be just shy of analysts' estimates.
IBM dropped 1.56 to 117.63, and Intel slipped 0.31 to 76.63.
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