Techs, broader markets retreat
Technology stocks and the broader markets slide sharply after showing resilience last week in the face of negative economic data, terrorism threats and poor earnings.
The Dow Jones industrial average lost 275.67 points, or nearly 3 percent, to close at 9,269.50, as Boeing put pressure on the broader markets. The company lost out on a projected $200 billion U.S. government contract for fighter jets.
The Nasdaq composite index dropped 69.44 points, or nearly 4 percent, to 1,6.99.52. CNET's technology indexes were mostly down, with the largest gains in the PC software and Internet e-tailers sectors.
Last week, the markets staged a surprise rally and largely held onto those gains despite news that durable-goods orders, an important measure of the state of manufacturing, plunged in September.
Analysts saw that uptick as a sign that terrorism news and bad economic indicators aren't as important as long-term optimism about growth.
"Last week's economic data were unambiguously negative," said Peter Hooper, a Deutsche Banc Alex Brown analyst. "The stock market appeared to look past the bad news and improved further on the week, with prices returning close to their pre-attack level," he said. He attributed this to investors' belief that the Federal Reserve will cut interest rates by 50 basis points at its Nov. 6 meeting.
In technology news, eBay reaffirmed its fourth-quarter earnings estimates and said it expects gross merchandise sales to increase over the next four years. Shares in the online auctioneer fell $4.38, or 8 percent, to $52.62. CNET's Internet e-tailing index was up 3.91 percent.
General Motors said it will sell Hughes Electronics, its satellite TV unit, to EchoStar Communications for $25.8 billion in cash and stock. EchoStar fell $1.81 to $24.08, and Hughes Electronics was off 99 cents, or 6 percent, to $14.36.
WorldCom shares were up 39 cents to $13.77 after Lehman Brothers upgraded the stock to "strong buy" Monday. The adjustment was based on WorldCom's solid third-quarter results last week, good balance-sheet management and attractive valuation.
EMC fell 46 cents to $12.95 after gaining around 4 percent earlier in the day. The company unveiled a slew of new software products that run on data-storage machines made by rival companies.
Among other actively traded shares, Intel lost $1.68 to $24.18; Cisco Systems was down 87 cents to $12.95; Oracle fell 17 cents to $13.41; and Microsoft lost $2.56 to $59.64.
AOL Time Warner fell $1.35 to $32.15. Yahoo fell 76 cents to $11.30, and Amazon.com was off 51 cents to $7.05.
Staff and Reuters contributed to this report.