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Tech Industry

MIDDAY MARKETS: Chip war interrupts rally

    In the ongoing tug of war over chips, the bears had a leg up at midday, dragging technology stocks into negative territory. The Nasdaq fell 31.41 to 1,930.02, and the Dow Jones industrial average gained 16.40 to 10,143.34.

    The Inter@ctive Week @Net Index fell 3 to 178.59.

    The great chip debate continued this week, as Morgan Stanley analyst Mark Edelstone cut ratings on a slew of companies, including Intel (Nasdaq: INTC), down $2.10 to $26.02, Xilinx (Nasdaq: XLNX), down $2.52 to $38.62, and Broadcom (Nasdaq: BRCM), down $4.04 to $31.34. He said it's too early to tell whether the semiconductor sector has hit bottom.

    The news foiled the rally for technology stocks that began last week. The Nasdaq gained 14 percent during last week's trading period, which ended on Thursday due to the Good Friday holiday.

    "We've had a tremendous gain. We did almost a bull market recovery in four days," Paul Cherney, market analyst at S&P Marketscope told Reuters. "It's only natural to take some profits."

    In company news, online travel agency Expedia (Nasdaq: EXPE), up $1.40 to $19.07, said it will report its first operating profit in the third quarter, though losses including charges will be steep. The company's outlook was accompanied by some bullish reports on the online travel sector.

    DoubleClick (Nasdaq: DCLK) fell $1.21 to $10.80 Monday as analysts came down hard on the stock. Though the company met estimates last week, its new projections were much worse than had been expected.

    Amazon (Nasdaq: AMZN) was off 58 cents a share to $14.09, AOL Time Warner (NYSE: AOL) rose $1.04 to $43.26 and Yahoo (Nasdaq: YHOO) was up 78 cents to $17.74.

    Cisco Systems (Nasdaq: CSCO) fell $1.02 to $16.96, Oracle (Nasdaq: ORCL) rose 71 cents to $16.53 and Microsoft (Nasdaq: MSFT) was off $1.34 to $60.84.

    ZDII staff and Reuters contributed to this roundup.