Dow sheds 436; Nasdaq dips below 2,000

Blue-chip and technology stocks are pounded as the Nasdaq reaches its lowest point since December 1998, and the Dow tumbles as investors choose to take profits and run.

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Blue-chip and technology stocks were pounded Monday as the Nasdaq composite index plunged 129 points, or 6 percent, to 1,924.15, knocking the tech-laden index below 2,000 points for the first time since December 1998.

The Dow Jones industrial average tumbled 436 points, or 4 percent, to 10,208.25 as investors chose to take whatever profits they'd amassed in the blue chips and run.

After breaking through the 5,000-point threshold in March 2000, the Nasdaq has lost more than 60 percent of its value in the past year.

"Investor sentiment is extremely negative right now. In the immediate future there is nothing but grim news ahead as earnings revisions downward continue," said Peter Anderson, chief investment officer at American Express Financial Advisors.

Cisco Systems added to that negative vibe Monday when its shares fell $1.81 to $18.81 after the company warned that the economic slowdown could last more than the six months it previously forecast. It announced Friday that it would eliminate as many as 8,000 jobs.

Other network-equipment stocks lost ground Monday as Nortel Networks and Lucent Technologies shed $1.25 and 82 cents a share, respectively. Redback Networks dropped $1.78 to $17.72, and Juniper Networks closed off $5.19 at $49.69.

A warning from Swedish telecom equipment maker Ericsson sent the company's shares south, falling $2.09 to $6.28. Competitors Nokia and Motorola lost $1.35 and 55 cents a share, respectively.

Microsoft fell $4.75 to $51.94. Oracle, which reports its third-quarter results later this week, slid $1.13 to $15.25, and Sun Microsystems ended off 38 cents at $17.06.

Citing "dismal economic conditions," flash memory maker Silicon Storage Technology warned it would miss revenue and earnings estimates for the quarter. The stock closed down $1.19 at $9.31.

Intel fell $1.69 to $27.75, Advanced Micro Devices slipped 57 cents to $22.73, and IBM closed off $3.80 to $95.49.

Shares in Ciena tumbled $11.81 to $53.31 as the fiber-optic systems supplier suffered from renewed signs of slumping demand in the sector.

Among widely held PC stocks, Dell Computer lost $1.31 to $22.06, Compaq Computer trimmed 55 cents to $17.95, Gateway shed 69 cents to $15.16, and Apple Computer closed off $1.75 to $18.50.

Staff and Reuters contributed to this report.