Bank technology stocks took a dive Friday, amid a general market drop and some sobering comments from Federal Reserve chairman Alan Greenspan.
Mr. Greenspan's comments, which suggested the markets have risen too quickly for their own good in recent weeks, fueled an early morning selloff as investors saw it as a a sign the Fed might raise interest rates soon.
But fresh economic data from the Labor Department showed unemployment at a four-month high - suggesting no rate hike is imminent - and the market recovered some of its earlier losses.
The markets Friday were "a bit frothy," said Richard Weingarten a San Francisco-based analyst with Montgomery Securities.
He noted the technology-laden Nasdaq composite was in a particularly turbulent state, shedding 40 points or 3% at one point. For the week the index was off 12.42 points to close at 1,287.7.
Goldman, Sachs & Co.'s composite index of U.S.-traded technology companies lost 1.07 points to close at 119.27.
The stock of Cybercash Inc. bucked the downward trend, gaining $1.75 for the week to close at $27.
The rise follows the Reston, Va.-based company's announcement that it is developing a payment mechanism that works with Sun Microsystems Inc.'s Java Commerce tool kit.
Also, Cybercash's chief financial officer, Gene Riechers, said he will resign to become managing director of a new venture capital fund founded by Friedman Billings Ramsey & Co., Arlington, Va.
The fund, called Pegagus Venture Partners LP, will focus on technology companies in the Washington, D.C., area. Pegasus has an initial capitalization of $25 million.
Starting in January, Friedman Billings Ramsey also plans to offer a family of mutual funds based on financial services firms.
Harbinger Corp. has entered a marketing agreement in which Unisys Corp. will promote the Atlanta-based firm's products and services for electronic data interchange and the Internet.
Harbinger provides software and value-added network services to banks and businesses.
Harbinger said more than $1.5 billion in automated clearing house payments flow through its network each month. The company's stock fell by 12.5 cents and closed at $26. The stock of Blue Bell, Pa.-based Unisys lost 37.5 cents to close at $7.25.
Elsewhere, Alltel Information Services Inc. said it expects its call center outsourcing system for banks to generate upward of $100 million in revenue by 2000.
The information services unit of Alltel Corp., Little Rock, contributes 30% of the parent company's revenues.
Randy Watson, general manager at Alltel, said nine banks are in various stages of converting to its Customer Service Workstation call center software, which was released in January.
Mr. Watson expects annual call center-related revenue growth of between 30% and 40% over the next five years. The growth also will come from the integration and consultation services that Alltel provides.
Alltel shares were off 50 cents, closing at $31.375.