A jump in crude oil prices to a new nine-year high and a profit warning from Procter & Gamble sent blue-chip stocks into a tailspin Tuesday as the Dow Jones industrial average plunged 374 points to 9,796.03.
For a change, even the technology stocks were unable to buck the selling trend. After spending much of the day flirting with the 5,000-point threshold, the Nasdaq closed off 57 points to 4,847.81.
"There is good reason for concern because a good piece of the old economy is not doing so well in this environment," said Roy Blumberg, money manager at Sheer Asset Management. "But it is going to take a lot from the Fed to slow the tech rally."
Microsoft (Nasdaq: MSFT) closed up 2 1/8 to 92 7/8 after Goldman Sachs analyst Rick Sherlund said it appears to be on track to meet first quarter targets and settle its antitrust case with the federal government.
Oracle Corp. (ORCL) shed 13/16 to 74 15/16 and Sun Microsystems Inc. (SUNW) lost 2 11/16 to end at 94 5/16.
Verisign (Nasdaq: VRSN) plunged 47 7/16 to 200 after announcing it plans to buy Internet domain registrar Network Solutions (Nasdaq: NSOL) in a multibillion-dollar stock swap. Shares of Network Solutions closed up 46 25/32 to 407 13/32.
Among widely held PC stocks, Dell Computer Corp. (DELL) fell 1 to 45 3/4; Gateway Inc. (GTW) lost 2 1/4 to 63 1/4; Apple Computer Inc. (AAPL) sawed off 2 3/16 to 122 7/8 and Compaq Computer Corp. (CPQ) lost 1 5/16 to 26 5/8.
Advanced Micro Devices Inc. (AMD) led the chip sector, picking up 5 7/16 to a 52-week high of 52 15/16. Intel Corp. (INTC) closed off 1 5/8 to 115 3/4.
Lam Research Corp. (LRCX) gained 5/8 to 152 after setting a 2-for-1 split. Applied Materials Inc. (AMAT) gained 1/8 to 184 1/8 and Novellus Systems Inc. (NVLS) rose 1/2 to 63 3/4.
Priceline.com Inc. (PCLN) slid 11 9/16 to 78 5/8, giving back some of Monday's gains after announcing that its first quarter sales will be better than expected. Yahoo! Inc. (YHOO) shaved off 3/16 to 171 3/8 while America Online Inc. (AOL) and Amazon.com Inc. (AMZN) closed off 5/8 and 7/16, respectively.
Terayon Communications Systems (Nasdaq: TERN) shot up 23 3/16 to 253 1/8 after announcing its first quarter sales and earnings will top Street estimates.
A trio of Web security software stocks made nice gains after Prudential Securities issues some positive comments.
RSA Security Inc. (RSAS) moved up 8 11/16 to 81 5/8 while Check Points Software (CHKP) and Axent Technologies (AXNT) closed up 16 9/16 and 1 7/8 a share, respectively.>