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Tech Industry

Huge merger fails to lift tech shares

Despite a major technology merger that tips the scales at more than $40 billion, tech shares drag the Nasdaq lower on the eve of earnings season.

    Despite a major technology merger that tipped the scales at more than $40 billion, tech shares dragged the Nasdaq lower on the eve of earnings season.

    The Nasdaq composite index fell 42.91 to 3,980.29, and Standard & Poor's 500 index dropped 3.28 to 1,475.62.

    The Dow Jones industrial average rose 10.60 to close at 10,646.58 led by aluminum giant Alcoa, which gained $2.06 to close at $29.69.

    Among widely held tech shares, Intel closed down $1.50 at $137.81, and Microsoft dipped $2.56 to close at $79.44.

    The CNET tech index shed 48 to close at 2,803.90. Losers edged out winners, with 63 of the 94 stocks in the index falling, 28 rising and three remaining unchanged.

    Of the 18 sectors tracked, computer equipment distributors posted the largest gains, climbing about 2 percent. Semiconductor makers were the day's biggest losers, falling 2 percent.

    Negative earnings news made TenFold, a maker of e-business software, the Nasdaq's largest percent loser. The shares fell $6.81, or 40 percent, to $10.25 on volume of 6.6 million shares, more than 26 times the stock's average daily volume.

    Among members of the CNET tech index, shares of JDS Uniphase fell $15.06, or 13 percent, to $101.13. Volume reached 67 million shares, making it the most actively traded stock on the Nasdaq.

    The company announced today that it will buy optical equipment maker SDL for about $41 billion in stock. SDL's stock jumped on the news, gaining $25.38, or nearly 9 percent, to $320.69.

    Other significant tech movers included Net advertising company DoubleClick, down $4.25 at $31.69; Net venture firm CMGI, down $5.63 at $39; and Web services company Inktomi, down $13.38, or 11 percent, to $108.50.

    The Philadelphia semiconductor index slipped 7.61 to 1,152.81. Chipmaker Advanced Micro Devices rose $2.25 to close at $84.25 after analyst Dan Niles at Lehman Brothers increased his price target on the shares to $110 from $100.

    Shares of Yahoo fell $6.50 to close at $110 as investors nervously await tomorrow's release of the Internet portal's earnings. Wall Street expects another strong quarter, but there is concern about the company's revenues from advertising.