Investors dumped stocks indiscriminately Tuesday following another wave of profit warnings as the Dow Jones industrial average plunged 293 points, or 3 percent, to finish at 9,485.31.
The Nasdaq composite tumbled 110 points, or 6 percent, to end at 1,672.61.
"It's the continued earnings surprises on the downside," Matt Brown, head of equity management for Wilmington Trust, told Reuters. "What hurts even more is the outlook--right now there's no visibility as to when this economy is going to turn around."
Analysts said the flood of profit warnings from technology companies would likely continue for the next few weeks, setting the stage for further losses in the equities market.
Ariba (Nasdaq: ARBA) fell $2.06 to $4.44 after warning on Monday that it will post a huge second-quarter loss and lay off about one-third of its staff. i2 Technologies (Nasdaq: ITWO) dropped $1.94 to $13.50 and Commerce One (Nasdaq: CMRC) shed $2.24 to $5.61.
Redback Networks (Nasdaq: RBAK) dropped $1.93 to $9.77 after warning it will post a loss in its first quarter. Other network-equipment stocks fell in sympathy. Ciena (Nasdaq: CIEN) shed $6.75 to $35.69, while Tellabs (Nasdaq: TLAB) and Lucent Technologies (NYSE: LU) lopped off $2.25 and 98 cents a share, respectively.
Consumer-electronics chain Best Buy (NYSE: BBY) bucked the trend after it easily topped analysts estimates for the fourth quarter. Its shares closed up $3.20 to $40.
Intel (Nasdaq: INTC) lost 86 cents to finish at $24.94. Advanced Micro Devices (NYSE: AMD) lost $1.85 to $23.65, and IBM (NYSE: IBM) closed off $4.27 to $90.39.
Microsoft (Nasdaq: MSFT) dipped $2.44 to $53.38. Oracle (Nasdaq: ORCL) sawed off $2.07 to $13.25, and Sun Microsystems (Nasdaq: SUNW) closed off $1.11 to $14.08.
PSINet (Nasdaq: PSIX) said it was delaying filing its annual report and warned it could declare bankruptcy. The Internet service provider also said it expects to take "significant" restructuring charges for the fourth quarter of 2000. Trading in the stock was halted at 19 cents.
Yahoo (Nasdaq: YHOO) fell $2.63 to $11.38. America Online Time Warner (NYSE: AOL) shed $3.27 to $33.90, while Amazon.com (Nasdaq: AMZN) and eBay (Nasdaq: EBAY) tumbled 47 cents and $4.63 a share, respectively. Amazon closed at $8.63, and eBay closed at $30.69
Inktomi (Nasdaq: INKT) plunged $3.43 to $2.79 after warning on Monday of a wider-than-expected loss.
Among widely held PC stocks, Dell (Nasdaq: DELL) dropped 63 cents to $23.44, Compaq (NYSE: CPQ) dipped $1.49 to $16.49, Gateway (NYSE: GTW) lost 90 cents to $15.05 and Apple Computer (Nasdaq: AAPL) ended off $1.35 to $20.24.
ZDII staff and Reuters contributed to this roundup.
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