Chip Stocks Gain as Market Tumbles
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A big gain in shares of SanDisk (NASDAQ: SNDK) helped boost the chip sector on Wednesday, but the rest of the market tumbled on fears of a GM (NYSE: GM) bankruptcy and a big sell-off in U.S. treasury bonds.
SanDisk jumped 14% after the company renewed a licensing agreement with Samsung, which accounts for more than half of the company's total royalties, according to Broadpoint AmTech analyst Dinesh Moorjani.
The chip sector ended the day 1.6% higher, even as the Nasdaq lost 1% and the Dow and S&P 2% each.
Apple (NASDAQ: AAPL) gained 1.7%, extending Tuesday's 7% gain on a Morgan Stanley upgrade. RBC Capital was the latest firm to make upbeat comments about the company, predicting market share gains on lower iPhone prices.
EMC (NYSE: EMC) and VMware (NYSE: VMW) were other gainers in the tech sector, while Dell (NASDAQ: DELL) was little changed a day ahead of its quarterly earnings report.
Analysts expect Dell to report a 21% decline in sales to $12.68 billion and earnings of 23 cents a share, down from from 38 cents in the year-ago quarter, and they're also looking for a similar sales decline in the July quarter, according to Thomson Reuters.
Google (NASDAQ: GOOG), Symantec (NASDAQ: SYMC) and Broadcom (NASDAQ: BRCM) were among the other names escaping the broad market sell-off. Symantec gained on a Morgan Keegan upgrade.
Take-Two (NASDAQ: TTWO) was up 8% after its results beat Wall Street forecasts.
The Nasdaq fell 19 to 1731, the S&P 500 lost 17 to 893, and the Dow tumbled 173 to 8300. Volume rose to 5.7 billion shares on the NYSE, and 2.17 billion on the Nasdaq. Decliners led by a 25-11 margin on the NYSE, and 17-9 on the Nasdaq. Downside volume was 80% on the NYSE, and 63% on the Nasdaq. New highs-new lows were 23-51 on the NYSE, and 39-17 on the Nasdaq.