Intel (NASDAQ: INTC) and Sun Microsystems (NASDAQ: JAVA) posted better than expected results late Tuesday, but it remains to be seen if the good news will have much effect on a market obsessed with financial fears.

Intel's second-quarter sales were up 9% to $9.5 billion, $200 million ahead of estimates, and earnings of 28 cents a share were three cents better than expected. The company said global demand is strong, and it forecast third-quarter sales of $10-$10.6 billion, which compares favorably with $10.07 Thomson Financial estimates. But Intel shares were little changed after hours, perhaps owing to slightly weaker than expected gross margins.

Sun shares fared much better, soaring 10% in after-hours trading after the company said its quarterly earnings could come in well above Wall Street estimates.

But coming on top of another rocky day for the stock market, it remains to be seen whether the good news will have much effect on the stock market, which opened 2% lower, rallied into positive territory on a big drop in oil prices and SEC plans to limit short-selling in some financial stocks, but then fell back to end the day 1% lower.

Behind the drop in oil were comments from Federal Reserve chairman Ben Bernanke that economic growth could be weaker than expected in the second half.

Sprint (NYSE: S) gained 9% on reports of talks with SK Telecom (NYSE: SKM).

Microsoft (NASDAQ: MSFT) rose by 4% and Yahoo (NASDAQ: YHOO) fell by 4.6% as investors placed bets on winners and losers in the companies' proxy battle.

The Nasdaq added 3 to 2215, the S&P fell 13 to 1215, and the Dow tumbled 92 to 10,962. Volume soared to 7.4 billion shares on the NYSE, and 2.8 billion on the Nasdaq. Decliners led by a 25-9 margin on the NYSE, and 17-11 on the Nasdaq. Upside volume was 29% on the NYSE, and 55% on the Nasdaq. New highs-new lows were 26-1162 on the NYSE, and 43-572 on the Nasdaq.

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