Technology Stocks Dip
U.S. technology issues retreated broadly Tuesday morning as investors dumped shares of PC-maker Micron Electronics and other big-name stocks.
The technology group lost its footing as the Morgan Stanley Technology Index fell 1.4 percent while the broader Pacific Stock Exchange Technology Index dipped 1.2 percent.
Internet shares lost their recent momentum as the Goldman Sachs Internet Index fell 1 percent.Other indexes foundered as the Philadelphia Semiconductor Index lost 0.6 percent, the Goldman Sachs Hardware Index edged down 0.4 percent, and the CBOE Software Index fell 0.2 percent. The Amex Networking Index dipped 0.1 percent.
The tech-heavy Nasdaq Composite Index buckled under broad weakness in the technology sector, falling 22.69 points to 2115.34. The Dow Jones Industrial Average fell 2.83 to 8985.76.
Shares of Micron Electronics (MUEI) fell 16 percent after the direct-market computer company posted better-than-expected first-quarter earnings, but also said sales dropped about 28 percent. Micron posted fiscal first-quarter earnings of $11.7 million, or 12 cents a share, but the company said sales were $403.5 million, down from $558.9 million.
The Internet holiday buying spree screeched to a halt as America Online (AOL) fell 1 to 116, eBay (EBAY) shed 7 1/2 to 288 7/8, Yahoo (YHOO) tumbled 6 1/8 to 241 3/8, Amazon.com (AMZN) fell 4 1/4 to 314 1/2 and Lycos (LCOS) dropped 3 1/16 to 55 3/4.
Most networking shares lost ground even as Cisco Systems (CSCO) rose 7/8 to a new all-time high of 95 9/16. Salomon Smith Barney raised its price target to $125 a share from $85 Tuesday, following a similar move by Donaldson Lufkin & Jenrette in the previous session.
Elsewhere, 3Com (COMS) rose 1/16 to 47 3/16, Newbridge Networks (NN) edged up 7/16 to 29 3/16 and Tellabs (TLAB) dropped 1 29/32 to 65 11/32.
Among computer makers, Apple Computer Inc. (AAPL) surged 1 1/16 to 36 1/8 after market researcher PC Data said the company's iMac led personal computer sales in November.
International Business Machines (IBM) rose 3/16 to 16 9/16 as Salomon Smith Barney boosted its price target.
Dell Computer (DELL) fell 1 3/16 to 70 3/4, Compaq (CPQ) dipped 11/16 to 43 9/16, and Hewlett Packard (HWP) fell 1/16 to 66. Apple Computer (AAPL), meanwhile, slipped 1/8 to 35 1/16.
Movers in the CBOE Software Index included Microsoft (MSFT), off 2 ½ at 137 15/16, Checkpoint (CHKPF), down 1 7/8 at 39 7/8 and Legato Systems (LGTO) down 2 1/8 at 55.