The Cyber Monday Meltdown

by: Eric Savitz December 01, 2008 | about stocks: AAPL / CMCSA / CSCO / DELL / INTC / MSFT / ORCL / QCOM / RIMM / YHOO    

Eric Savitz

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The National Bureau of Economic Research, the official U.S. arbiter for declaring recessions, today announced that - surprise! - we’re in a recession, and have been since December 2007. I’m not sure who is actually surprised to hear that news; but nonetheless investors used that development and other fresh signs of economic trouble as a pretty good excuse to take some profits after a 5-session rally in which the Dow Jones Industrial Average and the Nasdaq Composite both rallied nearly 17%.

Ergo, the Nasdaq Composite today swooned 137.50, or 8.95%, to 1,398.07. Ouch. That was worse than the 7.7% drop by the Dow, and about in line with the 8.93% slide by the S&P 500. While Black Friday shopping went a little better than expected, there were indications that shoppers stuck to extreme bargains, and left the mall when the deals were gone. Meanwhile, there were new signs of trouble in the tech sector, including a grim forecast from Taiwan Semiconductor, and some new gloomy data on chip sales from the Semiconductor Industry Association.

In short, if you thought the “Cyber Monday” kick-off to the online shopping season was going to give the market a jolt, you were very, very wrong.

Behold the grim toll taken on the list of the most actively traded Nasdaq listed tech stocks:

  • Microsoft (MSFT) fell $1.61, or 8%, to $18.61.
  • Cisco (CSCO) fell $1.58, or 9.6%, to $14.96.
  • Intel (INTC) fell $1.24, or 9%, to $12.56.
  • Oracle (ORCL) fell 62 cents, or 3.9%, to $15.47.
  • Apple (AAPL) fell $3.74, or 4%, to $88.93.
  • Dell (DELL) fell $1.12, or 10%, to $10.05.
  • Research In Motion (RIMM) fell $2.67, or 6.3%, to $39.80.
  • Yahoo (YHOO) fell 77 cents, or 6.7%, to $10.74.
  • Comcast (CMCSA) fell $1.89, or 10.9%, to $15.45.
  • Qualcomm (QCOM) fell $3.61, or 10.8%, to $29.96.

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This article has 4 comments:

  •  
    Dec 01 08:22 PM
    When asked what he thought the market would do, JP Morgan said: "it will fluctuate."

    Robert Shiller, a Yale professor, found much of the fluctuation is not justified.

    david-swensen.com/2008.../
    Reply | Link to Comment
  •  
    Dec 01 11:42 PM
    Agreed- some surprise that we're in a recession... because you know, I was starting to think....
    Reply | Link to Comment
  •  
    Dec 02 12:33 AM
    Recession,Depression ,all of these scenarios have been mentioned by the media and discounted by the market.
    After lagging the curve the FED,the Administration ,the Treasury and the Congress have addressed the issues effecitively .
    Now we need moratorium on "short " positions for six months to allow the implemmented remedies to work.
    At this point in time the media and certain"predator&... funds are responsible for the investors paranoia.
    Economy is heading for a moderate expansion in the first half of 2009 and major rebound in the second half of 2009.
    Let the SEC contrbute to the analytical rationale and reinstate the moratorium on the short positions.
    One more time ,the remedies applied are very dynamic and catalytic but need time to have an impact-i dont want to hear the free market "nonsense" anymore -I want to see the moratorium now ,not when it is too late..
    For the record ,I have predicted the current events in an interview with Mark Gilbert in June of 2005 -that includes the level on the 10 yr Treasuries .I have repeated my convictions/prediction... on September18 /2007 during the interview with Brian Sullivan(Bloomberg TV-Fed time)-back then I was told that I was wrong as I am being told now that I am wrong.

    Reply | Link to Comment
  •  
    Dec 02 01:58 AM
    I am a little confused. Since tech stocks (Microsoft and Apple) were battered and semiconductors are predicting grim future, ergo, on-line sales will be weak.

    Can we not get on-line and shop on Amazon or eBay when Cisco stock goes down? Someone please explain to me. Is that how the Internet works?
    Reply | Link to Comment
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