Tech Stocks Pull Back Ahead of Cisco's Results
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With the Nasdaq up 38% from its low of March 9 and Cisco's (NASDAQ: CSCO) quarterly earnings report on deck for Wednesday, investors chose to play it cautiously on Tuesday.
Analysts expect Cisco to report earnings of 25 cents a share, down from 38 cents in the year-ago quarter, on a 17.6% drop in sales to $8.07 billion, according to Thomson Reuters.
But the company's outlook and comments on the state of IT spending will be the most important part of the report and conference call. Juniper Networks (NASDAQ: JNPR) sparked a rally last month when it said it sees demand beginning to stabilize.
Analysts are looking for earnings of 27 cents a share on sales of $8.26 billion for Cisco's July quarter.
Cisco's shares edged higher ahead of the report, but the rest of the tech sector gave back a half percent, led lower by a weak outlook from NetSuite (NYSE: N).
Microsoft (NASDAQ: MSFT), Intel (NASDAQ: INTC) and Dell (NASDAQ: DELL) lost 2% or more each.
Microsoft announced more layoffs, while Yahoo (NASDAQ: YHOO) gained on speculation that it may yet strike a partnership with the software giant.
eBay (NASDAQ: EBAY) and Amazon (NASDAQ: AMZN) were also strong on a day that saw Apple (NASDAQ: AAPL) and Google (NASDAQ: GOOG) facing antitrust questions and Apple reportedly weighing a bid for Twitter.
Research in Motion (NASDAQ: RIMM) rose 1.5% on an NPD Group report that the BlackBerry Curve outsold Apple's iPhone in the first quarter, while Palm (NASDAQ: PALM) was up 3%.
Nvidia (NASDAQ: NVDA) fell 4% on a Wedbush Morgan downgrade ahead of its results on Thursday.
The Nasdaq lost 9 to 1754, the S&P 500 slipped 3 to 903, and the Dow lost 16 to 8410. Volume declined to 8.29 billion shares on the NYSE, and 2.99 billion on the Nasdaq. Decliners led by a 20-17 margin on the NYSE, and 15-12 on the Nasdaq. Upside volume was 53% on the NYSE, and 48% on the Nasdaq. New highs-new lows were 21-65 on the NYSE, and 27-16 on the Nasdaq.