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MARKET CLOSE: Techs keep tumbling

2 min read

Technology reeled again Wednesday.

The Nasdaq Composite Index fell 129.84 to 4,013.34. Inter@ctive Week's @100 Index tumbled 91.52 to 4,407.07. The S&P 500 retreated 14.83 to 1,492.25.

However, Wall Street put money into big blue chips. The Dow Jones Industrial Average increased 50.03 to 11,310.64.

Pessimistic comments on technology companies from Wall Street analysts have spooked the market in recent days, spurring investors to cash in on strong gains in the high-tech sector made over the past month.

"You're just not going to get people buying (technology stocks) blindly as they have in past years. They're more sensitive to the price they pay," said Marshall Acuff, an equity analyst at Salomon Smith Barney.

Acuff added that was helping drive investors into some of the blue-chip shares. "You're getting better value there relative to future growth."

Worldcom (Nasdaq: WCOM) fell for the second straight day following its announcement of an agreement to buy Intermedia, the parent company of Digex (Nasdaq: DIGX), for $3 billion. Worldcom, which was downgraded by a pair of analysts, lost 2 1/4 to 31 1/2 as the most active stock on U.S. markets. Digex moved up 7/8 to 68 3/4.

Other heavily-traded technology stocks included Intel (Nasdaq: INTC), down 3 9/16 to 65 11/16, Cisco Systems (Nasdaq: CSCO), down 1 3/4 to 64 1/4, and Sun Microsystems (Nasdaq: SUNW), down 7 7/16 to 117 5/8.

Online brokers Ameritrade (Nasdaq: AMTD) and E*Trade Group (Nasdaq: EGRP) rose 2 3/16 to 20 13/16 and 5/16 to 18 3/8, respectively. Analysts issued positive comments on the stocks.

Shares of CDMA wireless proponent Qualcomm (Nasdaq: QCOM) gained 61 13/16 to 2 7/16. Chinese and foreign telecoms manufacturers, who would stand to earn billions of dollars selling CDMA equipment and handsets, said on Tuesday China Unicom had signalled it may build narrowband CDMA networks as early as January.

Implied volatility and turnover in options of Internet content and service provider Excite@Home Corp. (Nasdaq: ATHM) rose 3/4 to 17 9/16 amid active call buying as the stock gained ground on Wednesday.

Some e-tailers defied the downward trend, including eToys (Nasdaq: ETYS), up 1 1/2 to 6 3/8.

AOL Latin America (Nasdaq: AOLA) gained 1/2 to 8 3/8 following the company's quarterly report. Rival StarMedia Networks (Nasdaq: STRM) advanced 2 5/16 to 11 7/16.

Novell (Nasdaq: NOVL) retreated 3/8 to 10 11/16. The provider of network software and services plans to cut its workforce by 16 percent.>