MIDDAY MARKETS: Investors await Greenspan speech

2 min read

Technology stocks continued their downward path at midday Tuesday following signs that the economy is decelerating faster than expected. The Nasdaq fell 24.29 points to 2,284.21, and the Dow Jones industrial average gained 49.67 points to 10,692.20.

The Inter@ctive Week @Net Index fell 8 points to 230.12.

Two economic indicators came out on the downside of forecasts Tuesday: consumer confidence and durable goods orders. The news was expected to boost the markets since it heightens the possibility that the Federal Reserve could intervene with another interest rate cut. But investors appeared to be holding out ahead of Fed Chairman Alan Greenspan's speech to congress Wednesday.

Consumer confidence slumped in February to its lowest level in over four and a half years, signaling a severe economic downturn ahead, the Conference Board said on Tuesday. The index was down for the fifth straight month to 106.8 from a revised 115.7 reading in January.

New orders for U.S. manufactured goods also tumbled in January, reflecting a huge drop in orders for commercial aircraft and parts. The value of new orders for all types of long-lasting durable goods--ranging from refrigerators to airplanes--plunged 6 percent to a seasonally adjusted $202.02 billion last month, the Commerce Department said.

Wall Street was wary about Gateway's (NYSE: GTW) prospects Tuesday ahead of the company's analyst meeting. Shares of the PC maker fell 62 cents a share to $17.19, as Merrill Lynch downgraded the stock and said the company would probably cut its outlook.

Shares in i2 Technologies (Nasdaq: ITWO), down $4.81 to $30.69, took a beating after Nike implicated the company in its third-quarter revenue miss. Analysts said the maker of supply-chain management software wasn't entirely to blame.

Sawtek (Nasdaq: SAWS) fell 25 cents a share to $16.81, after it lowered earnings and revenue targets for its second quarter. Analysts cut estimates but maintained their respective ratings.

Prodigy Communications (Nasdaq: PRGY) beat analysts' estimates in its fourth quarter but saw its losses more than double from a year earlier. Shares of the Internet service provider were unchanged at $2.94.

Cable television company Mediacom Communications (Nasdaq: MCCC), up $1.69 to $19.44, has agreed to pay about $2.22 billion in cash for AT&T Broadband cable systems in Georgia, Illinois, Iowa and Missouri, doubling its size, the companies said on Tuesday. AT&T shares were up 78 cents to $22.62.

Cisco (Nasdaq: CSCO) fell 69 cents a share to $25.38, Intel (Nasdaq: INTC) rose 44 cents a share to $29.94, Oracle (Nasdaq: ORCL) fell $1.38 to $21.81 and Microsoft (Nasdaq: MSFT) was up $1.19 to $60.75.

Amazon (Nasdaq: AMZN) fell 6 cents a share to $11.88, AOL Time-Warner (NYSE: AOL) fell 74 cents a share to $45.65 and Yahoo (Nasdaq: YHOO) lost $1.56 to $24.19.