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عضو نشط
- التسجيل
- 31 أغسطس 2001
- المشاركات
- 63
Nasdaq Reshuffle Will Reduce Technology Presence: Taking Stock
By Josh P. Hamilton
New York, Oct. 18 (Bloomberg) -- 3Com Inc., Ariba Inc., CMGI Inc. and other computer- and Internet-related stocks are likely to be removed from the Nasdaq 100 Index when it has its annual adjustment.
Health-care companies such as Cephalon Inc., ImClone Systems Inc. and Sepracor Inc. will likely make up the bulk of the replacements in the index, which has served as a benchmark for large technology companies, according to Murali Ramaswami, Lehman Brothers Inc.'s global head of equity derivatives research.
In a report to clients, Ramaswami forecasts the removal of 16 technology companies from the 100-stock index when the Nasdaq Stock Market adjusts the membership in December. Only one of the likely additions, Symantec Corp., is a computer-related firm.
``It's the end of the more speculative so-called new-economy era,'' said Donald Selkin, chief market analyst at Joseph Gunnar & Co. ``It symbolizes the fact that stocks like Ariba and CMGI are practically down to zero. These stocks will never again achieve their market capitalization of a couple years ago.''
Because the Nasdaq 100 is supposed to include the largest non-financial stocks in the Nasdaq Composite Index, companies whose market values have surged, such as pharmacy-benefits provider AdvancePCS and Apollo Group Inc., owner of the largest for-profit U.S. university, are most likely to be added.
Firms whose value has plummeted, such as networking- equipment maker 3Com and Internet-commerce software maker Ariba, will probably be removed, Ramaswami said.
Software maker Microsoft Corp., the second-largest company by market value, will remain in the index, along with other bellwethers such as chipmaker Intel Corp. and software maker Oracle Corp.
`Less Idiosyncratic'
Still, if the changes go as Ramaswami projects, the weighting of drug shares in the Nasdaq 100 will rise to 15.8 percent from 12.9 percent. Computer software will fall to 23.1 percent from 23.9 percent, semiconductors to 16.3 percent from 18.5 percent and computer hardware to 8.8 percent from 9.9 percent.
``The reconstituted index will be less volatile,'' Ramaswami said in an interview. ``It will be less idiosyncratic or stock specific, and more broad based.''
While that may reassure some investors, who've seen the index tumble 72 percent from its March 2000 high, the changes also will affect the most actively traded equity issue, the Nasdaq 100 exchange-traded fund, known as the ``Triple-Q'' for its stock symbol, QQQ.
Exchange-traded funds seek to track the performance of an index, while trading throughout the day like a stock. ETFs have become popular because they allow investors to speculate on the index's direction during a trading day.
By Josh P. Hamilton
New York, Oct. 18 (Bloomberg) -- 3Com Inc., Ariba Inc., CMGI Inc. and other computer- and Internet-related stocks are likely to be removed from the Nasdaq 100 Index when it has its annual adjustment.
Health-care companies such as Cephalon Inc., ImClone Systems Inc. and Sepracor Inc. will likely make up the bulk of the replacements in the index, which has served as a benchmark for large technology companies, according to Murali Ramaswami, Lehman Brothers Inc.'s global head of equity derivatives research.
In a report to clients, Ramaswami forecasts the removal of 16 technology companies from the 100-stock index when the Nasdaq Stock Market adjusts the membership in December. Only one of the likely additions, Symantec Corp., is a computer-related firm.
``It's the end of the more speculative so-called new-economy era,'' said Donald Selkin, chief market analyst at Joseph Gunnar & Co. ``It symbolizes the fact that stocks like Ariba and CMGI are practically down to zero. These stocks will never again achieve their market capitalization of a couple years ago.''
Because the Nasdaq 100 is supposed to include the largest non-financial stocks in the Nasdaq Composite Index, companies whose market values have surged, such as pharmacy-benefits provider AdvancePCS and Apollo Group Inc., owner of the largest for-profit U.S. university, are most likely to be added.
Firms whose value has plummeted, such as networking- equipment maker 3Com and Internet-commerce software maker Ariba, will probably be removed, Ramaswami said.
Software maker Microsoft Corp., the second-largest company by market value, will remain in the index, along with other bellwethers such as chipmaker Intel Corp. and software maker Oracle Corp.
`Less Idiosyncratic'
Still, if the changes go as Ramaswami projects, the weighting of drug shares in the Nasdaq 100 will rise to 15.8 percent from 12.9 percent. Computer software will fall to 23.1 percent from 23.9 percent, semiconductors to 16.3 percent from 18.5 percent and computer hardware to 8.8 percent from 9.9 percent.
``The reconstituted index will be less volatile,'' Ramaswami said in an interview. ``It will be less idiosyncratic or stock specific, and more broad based.''
While that may reassure some investors, who've seen the index tumble 72 percent from its March 2000 high, the changes also will affect the most actively traded equity issue, the Nasdaq 100 exchange-traded fund, known as the ``Triple-Q'' for its stock symbol, QQQ.
Exchange-traded funds seek to track the performance of an index, while trading throughout the day like a stock. ETFs have become popular because they allow investors to speculate on the index's direction during a trading day.
