Chip stocks lost ground Tuesday after J.P. Morgan downgraded the sector to neutral.
J.P. Morgan said the sector could see falling margins and earnings early next year as demand and utilization rates fall and inventories build up.
J.P. Morgan analysts singled out Cypress, ONand Fairchildas vulnerable to a downturn. The stocks fell 4-6%, and the chip sector ended the day 1.5% lower.
The broader market finished mixed Tuesday on news of big declines in consumer confidence and new home sales.
The Nasdaq slipped 5 to 2116, the S&P was unchanged at 1215, and the Dow added 12 to 10,456. Volume declined to 1.95 billion shares on the NYSE, but rose to 1.62 billion on the Nasdaq. Decliners led 18-13 on the NYSE, and 16-13 on the Nasdaq. Downside volume was 58% on the NYSE, and 57% on the Nasdaq. New highs-new lows were 91-113 on the NYSE, and 89-57 on the Nasdaq.
After the close, Paychexbeat estimates.
During the day, Jabilfell 2% on inline results and guidance.
Audiblerose 6% on a new mobile phone download service.
Netflixclimbed 1.5% on a Bear Stearns upgrade.
Audiovoxand SBStumbled on warnings.
Aproposrose 5% on a buyout offer.