MARKET CLOSE: Techs slide as investors eye blue chips

Technology stocks continued their downward spiral Wednesday as the Nasdaq composite shed 29 points to finish at 2,706.14. The Dow Jones industrial average picked up 122 points to close at 10,629.11.

"Within the tech area we have seen a number of high-profile warnings and disappointments," said Michelle Clayman, chief investment officer at New Amsterdam Partners. "Meanwhile, there are a lot of old-economy stocks that were overlooked...so I think money is looking at those names."

The money definitely wasn't in Resonate (RSNT) Wednesday as the Internet software developer plunged $5.38 to an all-time low of $13 even though WR Hambrecht reiterated its "buy" rating and 12-month price target of $60 a share.

Microsoft (MSFT) fell $1.94 to $65.06 while Oracle (ORCL) and Sun Microsystems (SUNW) lopped off 3 cents and $1.50 a share, respectively.

Citing a weaker-than-expected kick-off to the holiday retail season, Merrill Lynch cut its fourth quarter sales target for Gateway (NYSE: GTW). The stock fell $1.50 to $29.50 ahead of a profit warning.

Apple Computer (AAPL) lost 47 cents to $17.56 while Dell (DELL) and Compaq (CPQ) shed 63 cents and 40 cents a share, respectively.

ChipPAC (CHPC) fell $4.44 to $2.94 on news its fourth quarter results would miss estimates.

ONI Systems (Nasdaq: ONIS) lost $5.44 to $45.56 after it and Progress Telecom said they have reached an optical networking deal, worth at least $15 million.

Yahoo! (YHOO) shares added $2.09 to $39.06. America Online (AOL) rose $2.80 to $43.36 while Amazon.com (AMZN) and eBay (EBAY) picked up $1.91 and $1.09 a share, respectively. CMGI (CMGI) closed up 34 cents to $10.88.

Intel (INTC) added 72 cents to $42.75. IBM (IBM) closed up $1.94 to $99.81 and Advanced Micro Devices (AMD) finished off 69 cents to $17.06.