MIDDAY MARKETS: Gateway and Altera sink techs

Wall Street let go of chip and PC stocks Thursday as Altera and Gateway brought the Nasdaq to its lowest level in 15 months. The Nasdaq plummeted 142.61 to 2,564.32, or 5 percent, and the Dow Jones industrial average dropped 170.26 to 10,458.85.

The Inter@ctive Week @Net Index shed 21 to 306.93.

Wall Street has given up on PC stocks. Gateway's (NYSE: GTW) fourth quarter profit warning discouraged analysts so much that many of them now liken PCs to TVs, a commodity business that investors should avoid. Gateway was down 11.75 to 17.75, Compaq (NYSE: CPQ) fell 3.2 to 19.5 and Dell (Nasdaq: DELL) dropped 1.88 to 19.94.

Look out below for Altera (Nasdaq: ALTR), down 3.18 to 22.75, and competitors Thursday. After pre-announcing its fourth quarter results would be lower-than expected based on an inventory correction, analysts were bearing down on chip makers. Xilinx (Nasdaq: XLNX) lost 3.63 to 39.38.

Intel Corp. (Nasdaq: INTC), down 4.31 to 38.44, was stuck in the middle of profit warnings from Gateway and Altera Thursday as analysts downgraded the chip maker.

News that Verizon (NYSE: VZ), down 0.19 to 55.62, was pulling the plug on a proposed merger with NorthPoint left shares of the DSL company battered down 1.59 to 0.41. Analysts gave NorthPoint a rare "sell" rating and said it is quickly running out of cash.

Informix Corp. (Nasdaq: IFMX), up 0.53 to 3.25, confirmed Thursday that its outlook for the fourth quarter ending Dec. 31, remains consistent with previous guidance. It's also biding time until it can repurchase "undervalued" stock.

NTT DoCoMo Inc., Japan's largest mobile phone company, will buy a 16 percent stake in AT&T Wireless (NYSE: AWE), up 0.5 to 18.38, for $9.8 billion in cash, in a move to promote its mobile Internet service in the U.S.

Tut Systems Inc. (Nasdaq: TUTS), down 3.69 to 7, announced Thursday that fourth quarter revenue will miss estimates due to tightening in the capital markets, which have affected some of Tut's service provider customers.

Cisco (Nasdaq: CSCO) fell 1.81 to 49.88, Microsoft (Nasdaq: MSFT) shed 5 to 60.06 and Oracle (Nasdaq: ORCL) gained 1.5 to 60.06.

Amazon (Nasdaq: AMZN) fell 3.06 to 23.88, AOL (NYSE: AOL) shed 3.31 to 40.05 and Yahoo! (Nasdaq: YHOO) dropped 2.62 to 36.44. .