A couple of profit warnings let the air out of technology stocks Wednesday as the Nasdaq composite plunged 129 points to close at 3,863.10. The Dow Jones industrial average fell 76 points to end at 10,483.60.
"Until we get through earnings statements, we are going to get a lot of concern each time one of these negative pre-announcements come out," said Tony Dwyer, chief market strategist at Kirlin Holdings. "I am surprised that the Nasdaq is not down more than it is."
In economic news, the Conference Board reported that leading economic indicators in May slipped 0.1 percent, indicating the economy is cooling, but not as much as expected: Wall Street had expected a 0.2 percent decline.
BMC Software (Nasdaq: BMCS) tumbled 14 3/16 to 21 5/16 after warning it would earn less than half what analysts were predicting for its first quarter due to weakness in its mainframe business.
Computer Associates' (NYSE: CA) plunged 21 3/4 to 29 3/8 after it said its first quarter looks bad and the second quarter doesn't look any better.
Microsoft (MSFT) lost 1 1/2 to 78 1/2 while Oracle (ORCL) and Sun Microsystems (SUNW) closed off 7 13/16 and 3 15/16 a shares, respectively.
Chip and chip-equipment stocks slid Wednesday after Salomon Smith Barney downgraded the entire sector.
Intel (INTC) lost 5 1/4 to 131 5/8 and Advanced Micro Devices (AMD) shed 9 3/4 to 74 1/2.
Entrust (Nasdaq: ENTU) said Wednesday it sees second quarter earnings to be 2 cents a share, below First Call's current consensus estimate of 8 cents a share. Its shares ended down 40 1/2, or 53 percent, to 36 5/8.
Comverse (Nasdaq: CMVT) dropped 8 1/8 to 83 1/8 after announcing it will buy Exalink, which specializes in router-based WAP software for about $480 million in stock.
Dell Computer (DELL) lopped off 1 5/8 to 47 7/16. Apple Computer (AAPL) slid 1 11/16 to 51 5/8 while Gateway (GTW) and Compaq (CPQ) closed off 1 1/4 and 1/4 a share, respectively.
Cisco Systems (CSCO) trimmed 2 3/4 to 61 7/8. Nortel Networks (NT) lost 1 1/8 to 71 1/18 and Lucent Technologies (LU) finished off 2 3/4 to 56 7/16.
Yahoo! (YHOO) dropped 7 1/16 to 120 13/16. America Online (AOL) moved up 1 1/8 to 54 3/4 while Amazon.com (AMZN) and eBay (EBAY) lost 1/2 and 2 1/4 a share, respectively.