Call it "Greenspan II." And, like all sequels, it's basically a rehashing of the original.
Fedmeister Alan Greenspan told the House Banking Committee on Wednesday pretty much the same things he told its Senate counterpart a day earlier -- that the US economy is "going flat out" although growth should slow a bit this year, and that the Fed is ready to act if it looks like the economy is in danger of overheating.
Wall Street was cautiously higher in mid-afternoon trading while digesting Mr. G's latest remarks. The Dow Jones Industrial Average gained 48.51 points to 9592.93, and the Nasdaq Composite Index was up 25.47 at 2401.82. The S&P 500 rose 11.38 to 1282.56.
"It's a pretty trendless day," said Hugh Johnson, chief investment officer at First Albany. "It doesn't appear that Greenspan is saying anything materially different from yesterday. And yesterday he offered something for everyone."
Still, Johnson added that traders have discerned a "slight tightening lean" in Greenspan's comments, and the market is bracing for a possible hike in interest rates when the Fed's policymaking committee meets next month.
Investors' wait-and-see mood was fortunate for Charles Schwab (SCH), which saw its online trading system crash for about an hour in the morning. Had this been a busier day, the company no doubt would have had thousands of irate customers clogging its switchboard. As it stands, Schwab seems to have gotten through the snafu unscathed, and the company's stock advanced US$1.56 to $74.38.
CNET (CNET), on the other hand, shed $3.56 to $120.44 after saying it will cough up $11.5 million in cash to purchase Winfiles.com, an online software service. Investors seem to be wary of CNET's recent shopping spree. Just a couple of days ago, the company spent almost $6 million for AuctionGate Interactive, and recently acquired NetVentures, an e-commerce software publisher.
Infoseek (SEEK) climbed $3.81 to $75.06 as it launched a new online shopping service -- GO Shop -- which adds a retail component to its Go Network portal. Discount clothing purveyor Bluefly (BFLY), slated to be prominently featured on GO Shop, surged 25 percent to $12.81. And Disney (DIS), Infoseek's Go Network partner, was up 94 cents at $35.81.
Software maker Bea Systems (BEAS) jumped 13 percent to $18 after posting a pro forma quarterly profit of 5 cents a share, a penny higher than estimates. The company's stock was subsequently upgraded by Goldman Sachs, BT Alex. Brown, and Dain Rauscher.
Meantime, business-application developer Brio Technology (BRYO) dropped 16 percent to $19.88 after saying it will shell out about $300 million for rival Sqribe Technologies. Credit Suisse First Boston downgraded Brio's stock to "buy" from "strong buy."
It was inevitable: Gateway 2000 (GTW) announced it will offer a year's worth of free Net access to buyers of its personal computers. You want to bet other PC makers are quick to jump on the bandwagon? Still, Gateway's stock slipped $1.63 to $80.88 as investors mulled the firm's roughly $21 million investment in online computer retailer NECX.
