Sluggish open
Investors may be relieved by news that Alcatel and Lucent have called off merger talks, but a profit warning from Sun Microsystems will overshadow any cheer.
Shares of Sun stumbled Wednesday after Goldman Sachs said the quarter looked weak. Sun shares closed down $1.80, or 9 percent, to $18.76, and contributed to the Nasdaq's 3 percent declines for the day. In after-hours trading, shares continued to fall.
Stocks to Watch
• Alcatel gave investors some good news. The company's American Depositary Receipts rose as high as $29.54 in after-hours trading from a close of $27.41. The French maker of telecommunications equipment said in a joint statement with Lucent Technologies that it has ended talks aimed towards acquiring the U.S. telecom company. Lucent also rose.
• Sun Microsystems warned late Tuesday that its fourth-quarter earnings will be below analysts' expectations, due mostly to weakness in European orders. The maker of server computers said it expects to earn 2 cents to 4 cents a share for the period ending June 30. The average estimate of analysts surveyed by First Call was 6 cents.
The company had previously warned that profit in the quarter ending in June would be flat or slightly lower than the 8 cents a share earned a year ago.
• Aether Systems could also catch some attention. The maker of wireless data products said it will buy back $20 million in convertible debt. The company also said it expects to meet its goal of reporting positive earnings before interest, taxes, depreciation and amortization by the third quarter of 2002.
At the Bell
The Dow Jones industrial average may open 38 points lower. The Standard & Poor's 500 index for June futures contracts was off 4.4 points to 1,264 at 4:15 a.m. PDT in 24-hour electronic trading.