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Nortel warning rocks tech stocks

Technology stocks get hammered again in the wake of Nortel's alarming profit warning as the Nasdaq composite plunges 128 points to finish at 2,425.05.

    Technology stocks were hammered again Friday in the wake of Nortel's alarming profit warning as the Nasdaq composite plunged 128 points to finish at 2,425.05.

    The Dow Jones industrial average closed off 92 points to 10,799.01.

    "Clearly there's a lot of angst in the marketplace," said Donald Berdine, chief investment officer at PNC Advisors. "The concerns are issues in the technology area and what is going to lead us out of the very slow growth we have at the moment."

    On the economic front, the U.S. government's Producer Price Index posted its biggest one-month gain in more than a decade in January.

    All off the 20-plus technology stocks featured in this daily roundup lost ground Friday.

    Nortel Networks tumbled $9.75 to $20 as analysts came down hard on the Canadian communications equipment company; most lowered their ratings and second-guessed even the company's drastically lowered expectations.

    The effect of Nortel's pre-announcement spilled across the tech sector Friday, sending networking and fiber-optic stocks tumbling. JDS Uniphase was downgraded at First Union and closed off $9.31 to $35.81. Ciena, which recently raised estimates for 2001, shed $6.38 to finish at $82.63.

    Corning lost $9.01 to $33 after it confirmed expectations for the first quarter, but ratcheted down growth targets for the full year and said it may announce layoffs in response to news from Nortel, one of its biggest customers.

    Cisco Systems dropped $2.56 to $28.25 and Lucent Technologies closed off 95 cents to $12.67.

    Among widely held PC stocks, Hewlett-Packard fell $3.22 to $33.13; Dell chopped off $1.50 to $23.50; Gateway clipped $1.40 to $19.55; Compaq slid $1.99 to $21.91; and Apple Computer finished off $1.06 to $19.

    Microsoft sawed off $1.63 to $57.19, while Oracle and Sun Microsystems fell $1.50 and $4 a share, respectively.

    Nextel Communications tumbled $4.13 to $25.44 after it posted a narrower-than-expected fourth-quarter loss, but said first-quarter results may be impacted by higher operating expenses in the first part of the year.

    Yahoo chopped off $3.13 to $28.19, while and eBay lost 81 cents and $1.75 a share, respectively. CMGI dropped 50 cents to $4.59 and America Online-Time Warner closed down $1.59 to $48.36.

    Intel shed $1.44 to $34.38. IBM lopped of $1.78 to $115 and Advanced Micro Devices ended off $1.52 to $24.71.