Technology stocks resumed their descent Tuesday as investors bailed out following another round of profit warnings. The Nasdaq composite shed 115 points to 3,240.56 while the Dow fell 44 points to finish at 10,524.40.
"We are in a bear market in the Nasdaq and it's no longer a buy-on-the-dip mentality," said Paul Cherney, a market analyst at S&P MarketScope. "Investors hold on for dear life on a dip and then when it bounces they say that's good enough to get out. All the rebound rallies have been viewed as an opportunity to exit at better than the previous day's lows."
Programmable logic device makers took heavy losses Tuesday after Salomon Smith Barney and Lehman Brothers both cut their ratings on the stocks.
Altera (ALTR) shares tumbled $11.06 to $29.81 while Xilinx (XLNX) and Actel (ACTL) shed $16.69 and $5.25 a share, respectively.
IBM (NYSE: IBM) shaved off $3.13 to $114.81 after announcing it will make capital investments worth $5 billion to support its semiconductor business around the world, expand facilities in Vermont and Japan and build a new chip-making plant in New York.
Intel (INTC) shares slid $1.50 to $37.56 and Advanced Micro Devices (AMD) closed off 13 cents to $22.25.
Among widely held PC stocks, Dell Computer (DELL) fell $1.42 to $24.20; Gateway (GTW) trimmed $2.10 to $45.90; Apple Computer (AAPL) lost 88 cents to $20.88 and Compaq (CPQ) closed off $1.28 to $24.20.
PanAmSat Corp. (Nasdaq: SPOT) lost 38 cents to $30.44 after it said third-quarter earnings were 6 cents a share, a penny less that First Call Corp.'s expectations, and much lower than the 23 cent-per-share profit the company reported for the same period in 1999.
Yahoo! (YHOO) dropped $3.06 to $82.69 ahead of its critical third-quarter earnings report due out after the bell. Amazon.com (AMZN) added 38 cents to $30.44 while America Online (AOL) and Lycos (LCOS) moved up 14 cents and $1.31 a share, respectively.
eBay (EBAY) closed off $3 to $57.94.
Open Market, Inc. (Nasdaq: OMKT) trimmed 66 cents to $3.28 after saying that it expects third-quarter earnings to miss estimates. The company also announced plans to restructure, laying off 150 workers, and attempting to bring it to profitability by the second half of 2001.
An affiliate company of Deutsche Bank Alex Brown has made a $1.02 billion offer for National Discount Brokers Group Inc. (NYSE: NDB). NDB shares rallied up $22.44 to $47.69.
Software maker Daleen Technologies Inc. (Nasdaq: DALN) gained 19 cents to $9.94 after it said its third-quarter revenue should exceed analysts' forecasts and its loss should be lower than had been expected as it continues to expand its customer base among telecommunications service providers.
Microsoft (MSFT) closed up 38 cents to $54.56 while Oracle (ORCL) and Sun Microsystems (SUNW) shed $2.13 and $3.63 a share, respectively.