Blue-chip stocks gave back some of their recent gains while tech stocks picked up some ground Tuesday as the Nasdaq composite rose 12 points to close at 4,082.43. The Dow Jones industrial average closed off 37 points to 11,215.47.
The latest government data showed sales of new homes hit their highest level in seven years in July, which raised some concern that the inflation-fighting U.S. Federal Reserve may not be done raising interest rates.
"I don't think there are any significant economic issues driving this. The market was up yesterday, it's pulling back today," said John Davidson, chief investment officer at Orbitex Management. "You're going to have to wait until after the Labor Day (holiday) to any real direction as market participants come back to the market both physically and mentally."
AT&T (T) shares added $1.56 to $31.81 despite its warning that it will see third-quarter profit five cents a share below estimates.
Among widely held PC stocks, Dell (DELL) added $1 to $40.50; Gateway (GTW) closed off 81 cents to $65.74; Apple Computer (AAPL) trimmed 38 cents to $70.94 and Compaq Computer (CPQ) lost 56 cents to finish at $34.06.
Intel (Nasdaq: INTC) rose 19 cents to $74.06 after announcing that a technical glitch caused it to cease shipments of its Pentium III microprocessors and recalled those already on the market.
Advanced Micro Devices (AMD) inched up 6 cents to $34.56 and IBM (IBM) gained $1.38 to finish at $132.88.
Motorola Inc. (NYSE: MOT) picked up 31 cents to $35.81 after saying it will buy Printrak International Inc. (Nasdaq: AFIS), in a deal worth around $160 million.
S3 Inc. (Nasdaq: SIII) closed up 31 cents to $11.94 after announcing it has restructured an agreement to sell its graphics chip business to VIA Technologies to allay accounting concerns expressed by the Taiwanese government.
Sun Microsystems (SUNW) chopped off 69 cents to close at $127.13. Oracle (ORCL) added $1 to $87.75 and Microsoft (MSFT) closed down 38 cents to $70.94.
724 Solutions Inc (Nasdaq: SVNX) gained $6.63 to $44.44 after Bank of America said it would use the company's technology in its first wireless banking and brokerage offering in the United States.
LTX Corp. (Nasdaq: LTXX) fell $1.13 to $24.56 despite announcing fourth quarter profits of 44 cents a share, well above First Call's consensus estimate of 28 cents a share.
Yahoo! (YHOO) shaved off $1.06 to $121. Amazon.com (AMZN) moved up 50 cents to $39.63 while America Online (AOL) and eBay (EBAY) shed 25 cents and $1.81 a share, respectively. Lycos (LCOS) tacked on 56 cents to end at $68.