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Market Movers: The Chips Are Down
After the Nasdaq's strong start, a tumble in the semiconductor sector drags the index into the red.
By Anjali Arora
USA – The Nasdaq faltered in the afternoon on Tuesday, as a big tumble in semiconductor stocks eroded early gains. The index lost 1.41 per cent, or 48.88, to close at 3419.81. The Dow must have absorbed some of the money from those losses because it rose 1.18 per cent, or 121.35, to 10393.07.
Tuesday's trouble began with National Semiconductor. Citing lower demand, the company issued profit warnings for the previous and coming quarters. Plunging $US12.56, or 34 per cent, the stock closed at $24.37 and took the rest of the sector down with it. Broadcom, PMC Sierra and Vitesse Semiconductor fell roughly 5 per cent each. And Novellus, KLA-Tencor and Applied Materials each posted losses upward of 7 per cent.
FreeMarkets.com soared on Tuesday on news of lower-than-expected losses. The stock jumped almost 12 per cent, or $5.97, to $55.94. It was a good day for B2B stocks overall; except for favourites Ariba and Commerce One, most in the sector rose.
Lucent continued its recent slide, dropping another 2 per cent, and other networking stocks fell along with it. Corning slid almost 8 per cent, or $7.94, to $93.50; JDS Uniphase was down 6 per cent, or $6.12, to $95.06; and Nortel Networks lost 5 per cent, or $3.50, to $63.44.
Large-cap tech stocks were mixed on Tuesday. The biggest drop came from Hewlett-Packard, which was down almost 6 per cent, or $5.87, to $92.50. Internet stocks also turned in mixed results, though eBay fell the hardest – 9 per cent, or $5.50, to $54.06. Internet software stocks also fell; RealNetworks and Kana Communications became the biggest losers there.
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