E-Commerce Stock Watch: Momentum Investors Pile On

There was good news for online banks and online brokers on Monday, with [email protected] (Nasdaq: NTBK) announcing that it had opened 8,000 new accounts in the first quarter, and CS First Boston analyst Bill Burnham reporting that online trading had climbed to approximately 450,000 trades a day during the first quarter of 1999.

But what started as a nice little run-up in early trading quickly turned into froth, as momentum investors keep piling on, until gains started to seem ridiculous.

Two of the biggest beneficiaries of the race-to-buy were [email protected], which soared nearly 34 percent, closing up 25-11/16, and Ameritrade (Nasdaq: AMTD), which rocketed to a new high, climbing 29-1/6 — more than 46 percent to 91-5/8.

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