Chips Prop Up Stocks

Solid gains in the chip sector helped save the stock market from a steep decline on Wednesday.

Stocks ended the day modestly lower on earnings and inflation worries, along with the crash of a small airplane in New York City.

But a gain of more than 1% in the chip sector helped limit losses.

Rambus was a big winner, gaining nearly 11% on a licensing deal with Toshiba.

AMD gained 5% on a ThinkEquity upgrade.

Lam Research continued the good news after the bell, edging higher after blowing past estimates, and the company’s guidance also appeared solid. But late news of a patent lawsuit filed against Intel by Transmeta seemed to weigh on the sector in after-hours trading.

Online brokers were big movers on news that Bank of America will offer free online trading. Ameritrade lost 12%, and E*Trade and Schwab also fell.

Ericsson and Sony gained on solid results from their joint mobile phone venture.

Audiovox and IDT fell on their results.

Investors had mixed reactions to news that stock option probes had claimed top officials at CNET and McAfee .

The Nasdaq slid 7 to 2308, the S&P 500 lost 3 to 1349, and the Dow fell 15 to 11,852. Volume rose to 2.59 billion shares on the NYSE, and 2.06 billion on the Nasdaq. Decliners led 19-13 on the NYSE, and 17-12 on the Nasdaq. Downside volume was 55% on the NYSE, and 58% on the Nasdaq. New highs-new lows were 155-18 on the NYSE, and 138-45 on the Nasdaq.

News Around the Web