A trio of big-name tech warnings has the markets poised for a sell-off ahead of the long weekend. European and Asian markets fell, while early indicators have the Dow set to open sharply lower.
After Thursday's close, three big name techs--Hewlett-Packard, Nortel Networks and Dell Computer--issued warnings for all or part of 2001 due to a slowing economy and reduced spending. The latter two companies also said they will be cutting jobs.
Hewlett-Packard (NYSE: HWP) hit analysts' lowered earnings estimates in its first quarter but revenue fell short of estimates. The company also told analysts to expect only single-digit sales growth this year.
Nortel Networks (NYSE: NT) said it will miss analysts' estimates in the first quarter and fiscal 2001 and that it will lay off 10,000 employees by year's end.
Dell (Nasdaq: DELL) missed reduced analysts' estimates in its fourth quarter, said it will cut more than 1,700 jobs, and lowered its first-quarter targets.
Broadband services provider Covad Communications (Nasdaq: COVD) said it will postpone its fourth-quarter and 2000 earnings release, originally slated for Feb. 27, to deal with accounting issues.
Friday will see a full slate of reports on the economic front. The Producer Price Index for January is forecast to have risen 0.2 percent, compared to December's flat reading, according to economists surveyed by Briefing.com.
Also expected today, housing starts for January are expected to have decreased to 1.55 million from 1.58 million in December; industrial production is forecast as unchanged compared to a 0.6 percent drop in the prior month; and capacity utilization is predicted to have slipped to 80.3 percent from 80.6 percent.
Expect the following technology stocks to be among Friday's most actively traded issues: Dell Computer (Nasdaq: DELL), Hewlett-Packard (NYSE: HWP), Nortel Networks (NYSE: NT) and Priceline.com (Nasdaq: PCLN).
The Nasdaq closed Thursday's trading session up 61.51 to 2,552.91 while the Dow Jones industrial average rose 95.61 to 10,891.02.
At the Bell
The Dow Jones industrial average is expected to open down 91 points. The Standard & Poor's 500 futures index lost 11 to 1322.10 at 7:21 a.m. EST in 24-hour electronic trading.
The Inter@ctive Week @Net Index rose 9 to 275.43.
The major Asian markets all lost ground. The Nikkei 225 and Hong Kong's Hang Seng both posted triple-digit losses, down 151.90 to 13,175.49 and 126.06 to 15,630.31, respectively. Singapore's Straights Times slipped 3.99 to 1,971.56.
European markets were down as well. London's FTSE 100 shed 72.90 to 6,125.00, the CAC 40 in Paris lost 75.60 to 5,628.93 and the DAX in Frankfurt dropped 80.53 to 6,511.14 at 7:11 a.m. EST.
Reuters contributed to this report.