Tech Stocks Plunge on Earnings Worries
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Tech stocks fell sharply Tuesday after weaker than expected results from Sun Microsystems (NASDAQ: JAVA) and Texas Instruments (NYSE: TXN) reminded investors of just how uncertain the economic outlook is.
And the outlook for tech spending remained murky after the close.
Apple (NASDAQ: AAPL) reported blow-out results on strong iPod and iPhone sales but then issued a fourth-quarter outlook that was unusually downbeat, even for a company known for its conservative guidance. Still, the numbers were good enough for the stock to recoup all of a 7% decline ahead of the report.
Yahoo (NASDAQ: YHOO) met earnings estimates and reported sales that missed Wall Street estimates, but the stock climbed in after-hours trading on relief that the numbers weren't worse. Yahoo also announced 10% layoffs.
On the bright side, VMware (NYSE: VMW) soared on its earnings report, and Broadcom (NASDAQ: BRCM) and QLogic (NASDAQ: QLGC) also gained in late trading.
Texas Instruments and Sun were just the start of the bad news for the market during the day, with weak results from Lexmark (NYSE: LXK), Caterpillar (NYSE: CAT) and DuPont (NYSE: DD) also weighing on the market.
HP (NYSE: HPQ), Dell (NASDAQ: DELL), Cisco (NASDAQ: CSCO), Microsoft (NASDAQ: MSFT), Intel (NASDAQ: INTC) and Research in Motion (NASDAQ: RIMM) were just a few of the names hit hard in the Nasdaq's 4.1% sell-off.
Tellabs (NASDAQ: TLAB) and Netflix (NASDAQ: NFLX) fell on their earnings reports, while SanDisk (NASDAQ: SNDK) and JDA Software (NASDAQ: JDAS) gained on their quarterly reports.
The Nasdaq fell 73 to 1696, the S&P lost 30 to 955, and the Dow tumbled 231 to 9033. Volume declined to 5.2 billion shares on the NYSE, and rose to 2.19 billion on the Nasdaq. Decliners led by a 20-8 margin on the NYSE, and 24-10 on the Nasdaq. Downside volume was 80% on the NYSE, and 88% on the Nasdaq. New highs-new lows were 9-142 on the NYSE, and 5-113 on the Nasdaq.