| Breaking
Down the Nasdaq 100 This Year - An Autopsy
By IndexFunds.com Staff
March 26, 2001 |
|
Thus far, 2001 has been like a train wreck for the technology
sector. In true rubberneck form, let's slow down for a second
and take a look at the extent of the carnage. Call it a morbid
fascination, but new research from the Equity Derivatives Strategy
Department at Merrill Lynch examines which companies are most
responsible for dragging down the Nasdaq 100 index.
The index, which is tracked by the highly-popular QQQ
exchange-traded fund (ETF), is comprised of the biggest companies
traded on Nasdaq, and was launched in 1985. The chart below shows
the performance of the index vs. the S&P 500 since April of
1994:
Source: Nasdaq, Reuters
The Nasdaq 100 is down 27.3% year-to-date as of March 22, 2001.
Source: Nasdaq
Only 21 companies in the index, just over one-fifth, had positive
year-to-date performance numbers. Cisco was the largest
contributor to the negative index performance, accounting for
3% of the 27.3% index decline.
| Top 5 Negative Contributors to NASDAQ 100
YTD Performance |
| Company |
Ticker |
YTD return |
YTD return contribution |
| Cisco Systems |
CSCO |
-48.4% |
-3.01% |
| Oracle |
ORCL |
-46.7% |
-2.00% |
| Qualcomm |
QCOM |
-30.8% |
-1.46% |
| JDS Uniphase |
JDSU |
-39.0% |
-1.38% |
| Siebel Systems |
SEBL |
-53.0% |
-1.14% |
Source: Merrill Lynch,
YTD returns as of 3/22/01
As the table below demonstrates, how quickly the high-fliers of
yesteryear can go down in flames.
| Historical Annual Performance of 2001 'Drag
Queens' |
| Company |
1998 annual ret. |
1999 annual ret. |
2000 annual ret. |
2001 YTD (3/22/01) |
| Cisco |
66.5% |
15.4% |
-64.3% |
-48.4% |
| Oracle |
93.3% |
159.9% |
-74.1% |
-46.7% |
| Qualcomm |
2.6% |
239.9% |
-53.3% |
-30.8% |
| JDs Uniphase |
67.7% |
132.5% |
-74.2% |
-39.0% |
| Siebel |
-18.8% |
147.5% |
-19.5% |
-53.0% |
Source: Reuters, Merrill Lynch
According to the CEO of the company at the top of the dubious
list, things aren't going to turn around any time soon. John Chambers
of Cisco today told Financial Times that he expects the
market downturn to last for at least three quarters. The Merrill
Lynch report is as of last Thursday's close - Cisco's stock has
slipped $1.86, or 9.42% as of today's close, since then amidst
rumors of further profit warnings.
The positive contributors to the Nasdaq 100 have been few and
far between in 2001, but Microsoft and Dell have been the brightest
spots. Microsoft is up 24.5% YTD, accounting for a 1.2%
contribution to the index; Dell is up 50.5% so far this
year, contributing 0.5% to the Nasdaq 100.
