The Nasdaq fell along with the broader market today, as tech stocks reacted to mixed earnings reports released yesterday.
The Dow Jones Industrial Average closed down 195.93--more than 2 percent--to finish at 8,932.98, while the Nasdaq closed down 34.53 at 1,935.22. Yesterday, the Nasdaq lost ground for the first time in nearly two weeks. The index previously had set record closes for nine consecutive days.
Analysts said the market's downturn this week also reflected a consolidation after its run-up to new highs. New worries about Asia's financial footing also figured in today's market activity. Of particular concern were rumors that Japan's AAA sovereign debt rating might be downgraded, and general uncertainty regarding the country's elections for a new prime minister, to be held tomorrow.
"The earnings season is winding down and the market is now going to focus on economic data and renewed concerns about Asia," said Peter Cardillo, director of research at Westfalia Investments. "There is growing concern that the new premier will not be able to implement the reform package, and that could renew negative sentiment."
Some technology stocks declined today, despite releasing better-than-expected financial results yesterday.
Amazon.com, for example, posted a pro-forma loss of 33 cents a share, better than the 43-cents-a-share loss Wall Street was expecting. The $15.8 million loss is much wider than the $6.7 million loss the company posted for its like quarter a year ago. Stock in the online book and music retailer closed at 127.625 today, off nearly 5 percent.
Data management company Informix posted a profit of 7 cents a share, beating Wall Street's expectations of only 3 cents a share. Nevertheless, the company's stock fell nearly 8 percent to close at 7.125.
Shares in music site N2K fell more than 9 percent today to close at 18, after the company reported a greater-than-expected loss of $1.18 a share yesterday.
Despite beating expectations with its third-quarter earnings report yesterday, Lucent Technologies, posted an acquisition-related loss of $233 million. Shares in the AT&T spin-off finished at 95.375, off more than 5 percent.
Some tech stocks fared much better.
Internet service provider MindSpring, for example, rose 6 percent to close at 149, beating the company's previous 52-week high of 141.375. Yesterday, MindSpring beat Wall Street's estimates, posting profits of 24 cents a share.
Cadence Design Systems jumped nearly 6 percent to close at 30.125 today. The product development software maker beat analysts' predictions by a penny yesterday.
CNET shares gained nearly 10 percent after the Internet company announced its first quarterly operating profit yesterday. The stock finished at 70.375, after hovering near a 52-week for high much of the day. (CNET: The Computer Network publishes NEWS.COM.)
Shares in Zapata, the fish-product processor turned Internet company, rose more than 12 percent today on forecasts that its third-quarter earnings would be strong. The stock closed at 21.625.
"We expect to post one of the most profitable quarters in Zapata's 45-year history," Avram Glazer, president and CEO of Zapata, said in a statement. The company, which previously has outlined its aggressive strategy for becoming a force on the Internet, said it would invest its profits in its online division.
Stock in Computer Associates also got a boost today, gaining nearly 3 percent to close at 40.625 on the New York Stock Exchange. The company took a double-digit tumble earlier this week after releasing solid first-quarter financial numbers but warning of slowing future revenue growth.
Reuters contributed to this report.