MIDDAY MARKETS: Techs continue to slide

There was little to cheer about at midday Thursday as more bad news from the technology sector kept the stock market in the red. The Nasdaq dropped 28.25 points to 2,123.58, while the Dow Jones industrial average fell 103.01 points to 10,392.27.

In economic news, the National Association of Purchasing Management Index, which measures purchasing agents' buying intentions, showed only a modest improvement. The index came in at 41.9 percent in February, slightly higher than January's 41.2 percent level. The index was lower than had been expected.

The Inter@ctive Week @Net Index slipped 6 points to 209.36.

Shares of communication chip maker Broadcom (Nasdaq: BRCM) fell $3.69, or 7.5 percent, to $45.56 after the stock's rating was cut at Merrill Lynch and Salomon Smith Barney, due to weak demand and continuing inventory woes.

Broadcom competitors Applied Micro Circuits (Nasdaq: AMCC), up 69 cents to $27.44, and PMC-Sierra (Nasdaq: PMCS), up $1.75 to $35.25, rebounded at midday after slumping early in the session. Vitesse Semiconductor (Nasdaq: VTSS) slipped 94 cents to $38.50.

Lam Research (Nasdaq: LRCX) shares fell 6 percent, off $1.31 to $20.19, on the heels of its profit warning. Analysts handed out downgrades and cut estimates for other chip-equipment makers for good measure. Novellus Systems (Nasdaq: NVLS) fell $2.75 to $35.88, KLA-Tencor (Nasdaq: KLAC) dropped $1.75 to $34 and Applied Materials (Nasdaq: AMAT) lost $1.88 to $40.38.

Fiber optics giant Corning (NYSE: GLW), up 92 cents to $27.96, said it will lay off 825 workers at photonics-manufacturing facilities because of decreased demand from the weakened telecommunications industry.

Online travel agencies Expedia (Nasdaq: EXPE) and Travelocity (Nasdaq: TVLY) were hit hard after airlines Northwest Airlines and KLM Royal Dutch Airlines jointly said they would eliminate Internet travel commissions. Shares of Expedia sunk almost 23 percent, down $3.56 to $12.06, while Travelocity plummeted more than 30 percent, off $6.75 to $15.50.

Canadian graphics chip maker ATI Technologies (Nasdaq: ATYT) saw its shares drop 16 percent after the company warned that it will report a loss in its second quarter and a lower-than-projected revenue because of higher memory costs and weaker global computer sales. Shares traded down 84 cents to $4.40.

Among widely held tech issues, Cisco (Nasdaq: CSCO) shed 63 cents to $23.06, Intel (Nasdaq: INTC) slipped 28 cents to $28.28, Microsoft (Nasdaq: MSFT) lost $1.44 to $57.56 and Oracle (Nasdaq: ORCL) added 56 cents to $19.56.

AOL Time Warner (NYSE: AOL) fell 88 cents to $43.15, Yahoo (Nasdaq: YHOO) dropped 31 cents to $23.50, and Amazon (Nasdaq: AMZN) slipped 6 cents to $10.13.

ZDII staff and Reuters contributed to this roundup.