Articles like this amaze me. Where are the earnings woes for this sector, and AMAT in particular? Wouldn't it be safe to assume that these same worries are what brought the stock down from 115 to 64, a fall of nearly 45%? Talk about throwing the baby out with the proverbial bathwater. I am disgusted; normally I buy on weakness, but this has been like a cascading waterfall with no end in sight. I am not selling any of my stocks here, but unfortunately am not buying either since I cannot tell where this is headed. I thought(and still do) that LRCX was a fantastic buying opp at 26, yet I am not buying now. My bullishness has not waned one iota, but I am reluctant to put additional money to work until I am certain it won't vaporize with the illogical selling we are seeing.
BK
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U.S. technology stocks stagger as earnings woes weigh
(UPDATE: Updates to early morning)
By Elizabeth Lazarowitz
NEW YORK, Aug 11 (Reuters) - Technology stocks slumped in early morning trading on Friday after the latest economic data painted a conflicting outlook for interest rates and Wall Street's corporate profit worries reemerged.
The Nasdaq market slid steadily as investors were disappointed with the latest earnings from high-tech heavyweight Dell Computer Corp. (NasdaqNM:DELL - news). Dell's revenues for the second quarter missed Wall Street expectations.
Blue-chip stocks, however, clung to modest gains, held afloat in large part by a jump in Philip Morris Cos Inc. (NYSE:MO - news), the world's largest cigarette company.
``Dell's drop is putting pressure on the Nasdaq,'' said Alan Ackerman, senior vice president and market strategist at Fahnestock & Co. ``It's part of a continuing process where sellers beget sellers when a company starts to show signs of revenue and/or earnings weakness.''
Dell's shares, the Nasdaq market's most heavily traded issue, tumbled 4 to 37-3/4.
The technology-laden Nasdaq Composite Index (^IXIC - news) fell 65.47 points, or 1.74 percent, to 3,694.52.
Weakness in high-tech shares dragged on the broader market, and the Standard & Poor's 500 Index (^SPX - news) fell 4.59 points, or 0.31 percent, to 1,455.66.
But the Dow Jones industrial average (^DJI - news) was up 28.21 points, or 0.26 percent, at 10,936.97.
Philip Morris climbed, 2-5/16 to 31, buoyed by positive remarks on the company's outlook from Goldman Sachs, traders said.
An upbeat assessment by Goldman Sachs of Loews Corp. (NYSE:LTR - news), whose broad interests include the tobacco, also lifted that company's stock. Loews, which is not a member of the Dow 30, rose 8-7/16 to 84-1/2.
Investors were breathing a sigh of relief after the government's July Producer Price Index (PPI) showed inflation
at the producer level continued to be tame.
But Wall Street was not quite as happy about the unexpectedly strong retail sales for July, analysts said. The numbers indicated consumer demand, seen as one of the major engines of the blockbuster U.S. economic expansion, remained
robust.
``The Producer Price Index is right in line and the good news is there is little inflationary characteristics,'' said Barry Hyman, market strategist for Ehrenkrantz, King, Nussbaum Inc.
But Hyman added: ``We got another confusing consumer strength number on the consumer sales.''
The PPI was unchanged in July following a 0.6 percent gain in June, while its core rate, excluding volatile food and energy, rose just 0.1 percent after a 0.1 percent drop in the prior month.
Economists had forecast a 0.1 percent gain in both the overall and core rates.
U.S. retail sales posted a gain of 0.7 percent, following June's revised increase of 0.4 percent. Excluding automobiles, it rose 0.6 versus a revised 0.3 percent gain in June.
Wall Street, which had been expecting a 0.4 percent increase in both the headline and core retail sales numbers, continued to seek confirmation that red-hot economic growth is slowing and the Federal Reserve can ease off the brakes by leaving interest rates steady.
The Fed meets next on Aug. 22 to decide whether to hike interest rates for what would be the seventh boost in rates since June 1999. |
