Blue-chip and technology stocks were battered Monday as investors continue to worry about rising oil prices and corporate profits. The Nasdaq composite plunged 109 points to finish at 3,726.54 while the Dow fell 118 points to close at 10,808.52.
"Today's market and the market in September reflect skepticism around the sustainability of this incredible trend in demand in the economy and tech products in particular, and also in profitability,'' said Ned Riley, chief investment strategist with State Street Global Advisors.
Profit warnings took their toll on several technology issues.
Allaire Corporation (Nasdaq: ALLR) fell $7.06 to $10.44 after it warned that its third quarter 2000 financial results would be below expectations. The company now expects to lose up to 20 cents a share, a big turn-around from First Call's expected profit of 7 cents a share.
ICG Communications, Inc. (Nasdaq: ICGX) lost $2.25 to $1.66 after it said slower growth and service problems forced it to issue a revised outlook, trimming estimates for revenues and earnings into 2001. Despite a reduction in expenditures under the revised plan, the company still needs funding, and is exploring strategic alternatives.
Intel (INTC) shares fell $1.64 to $55.88 while Advanced Micro Devices (AMD) and IBM (IBM) both lopped off $1.50 a share.
Net2Phone Inc. (Nasdaq: NTOP) slid $6.75 to $27.06 after announcing it has formed a new company for network management software for Voice over IP, Adir Technologies.
Cisco Systems, Inc. (Nasdaq: CSCO), down $2.69 to $60.06, has purchased a minority equity interest in the new company. Nortel Networks (NT) shed $4.69 to $68 and Lucent Technologies (LU) closed off $1.81 to $35.88.
Reseller Merisel Inc. (Nasdaq: MSEL) inched up 3 cents to 97 cents a share after selling its open computing alliance unit to distributor Arrow Electronics (NYSE: ARW) for $110 million in cash, the companies said Monday.
A change of ownership at its biggest customer has forced Telaxis Communications Corp. (Nasdaq: TLXS), down $5.06 to $6.69, to lower estimates for the third and fourth quarters of the year.
Yahoo! (YHOO) closed off 81 cents to $105.06. America Online (AOL) inched up 31 cents to $55.56 while Amazon.com (AMZN) and eBay (EBAY) dropped 81 cents and $1.38 a share, respectively.
Microsoft (MSFT) dropped $1.19 to $63. Oracle (ORCL) lost $1.84 to $76.47 and Sun Microsystems (SUNW) picked up $2.19 to $115.25.