The Nasdaq composite’s brief tenure above the 3,000-point threshold ended Tuesday as investors dumped tech shares following another barrage of profit warnings.
The index closed off 83 points to 2,931.87 while the Dow Jones industrial average added 42 points to finish at 10,768.27.
“Some people feel that 3,000 in the Nasdaq is an important level. So, we are seeing some profit taking,” said Alan Skrainka, chief market strategist for A.G. Edwards & Sons. “There was some initial euphoria in the wake of Alan Greenspan's clear message that he is poised to rescue the economy if it heads toward recession, but there are still some concerns especially in the chip sector that earnings will be disappointing.”
Advanced Micro Devices (AMD) fell 6 cents to $17.25, not bad considering the chipmaker warned that its fourth-quarter sales will fall short of analysts’ estimates. Intel (INTC) lost 88 cents to $36.56 and IBM (IBM) shed $1.13 to end at $93.88.
Microchip Technology (MCHP), which also warned Monday, fell $1.75 to $25.06. Dallas Semiconductor (DS) lost $8 to $26 after it too warned of sluggish sales and profits this quarter.
Sun Microsystems (SUNW) trimmed 13 cents to $33.88 after a couple of analysts voiced concerns about future revenue growth. Microsoft (MSFT) added 31 cents to $58.38 and Oracle (ORCL) closed off $1.19 to $30.75.
DoubleClick (Nasdaq: DCLK) actually gained $1.97 to $13.91 after it warned of lower sales in the next two quarters.
Fellow online advertising services provider Engage (ENGA), which reports after the bell, closed up 28 cents to $1.97.
Among widely held PC stocks, Dell (DELL) rose $1.63 to $21.69; Apple Computer (AAPL) inched up 19 cents to $15.38; Gateway (GTW) rose 8 cents to $17.60 and Compaq Computer (CPQ) moved up 53 cents to $20.77.
Pegasus Solutions (PEGS) was hammered Tuesday, falling $4.81 to $7.31 after issuing a profit warning.
Best Buy Co. (NYSE: BBY) picked up $1.19 to 25.75 after it met lowered analyst estimates in its third quarter.
Yahoo! (YHOO) added $1.94 to $35.81. America Online (AOL) tacked on 16 cents to $48.65 while Amazon.com (AMZN) and CMGI (CMGI) inched up 56 cents and 25 cents a share, respectively. eBay (EBAY) lost $2.56 to finish at $40.94.
Cisco Systems (CSCO) clipped 44 cents to $54.38. Nortel Networks (NT) shed $4.25 to $38.75 and Lucent Technologies (LU) rallied up $2 to $18.69.