Tech stocks survived another blue-chip drubbing on Wednesday, as strong earnings reports from Nvidia (NASDAQ: NVDA) and Applied Materials (NASDAQ: AMAT) provided the latest evidence that tech spending is holding strong in the face of a year-long credit market meltdown.
Nvidia and AMAT rose 10% and 5%, respectively, after issuing upbeat outlooks, holding the Nasdaq to a 2-point loss on a day that saw the Dow tumble 109 on rising oil and import prices, weak retail sales and lingering financial worries.
NetApp (NASDAQ: NTAP) didn’t fare nearly as well after the close, losing 4% despite beating estimates, as the company’s earnings guidance was slightly below estimates.
Apple (NASDAQ: AAPL), Qualcomm (NASDAQ: QCOM) and Palm (NASDAQ: PALM) were other gainers. Helping Apple was Best Buy’s (NYSE: BBY) plan to begin selling iPhones.
Brocade (NASDAQ: BRCD) rose 3% after beating estimates and raising guidance, the latest evidence that storage spending remains strong.
But the biggest test for tech stocks this month will be HP’s (NYSE: HPQ) earnings on Aug. 19, followed nine days later by Dell’s (NASDAQ: DELL) results. Those reports will be critical for continued investor confidence in the tech sector — and for proof that IT spending can continue to weather the downturn.
The Nasdaq lost 2 to 2428, the S&P fell 3 to 1285, and the Dow tumbled 109 to 11,533. Volume rose to 4.82 billion shares on the NYSE, and declined to 2.07 billion on the Nasdaq. Decliners led by a 19-14 margin on the NYSE, while advancers held a 15-13 edge on the Nasdaq. Downside volume was 61% on the NYSE, and 56% on the Nasdaq. New highs-new lows were 36-110 on the NYSE, and 81-89 on the Nasdaq.
Note: The Market Close will return on Monday.