Troubles in the technology sector pushed Wall Street's major indexes to their lowest levels since mid-May yesterday, with Apple Computer...
NEW YORK — Troubles in the technology sector pushed Wall Street’s major indexes to their lowest levels since mid-May yesterday, with Apple Computer and a downgrade of Intel leading the market downward.
The Dow Jones industrial average fell 36.26 to 10,216.91.
Microsoft, one of the 30 Dow stocks, slipped 11 cents to close at $24.30 a share. Boeing, also a Dow stock, gained 95 cents to $67.65.
Broader stock indicators were also lower. The Standard & Poor’s 500 index fell 7.19 to 1,177.68, while the technology-focused Nasdaq composite index fell 23.62 to 2,037.47.
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Investors’ worries about consumer spending intensified after Apple’s lower-than-expected third-quarter revenues. The market got more troubling news from Prudential’s downgrade of Intel, which said the company could face disappointing revenues and margins for up to the next year.
The company news hit a bruised market, as it followed nasty declines on Wall Street last week. Investors are worried about Federal Reserve interest-rate increases and high energy costs, issues that could hang over the market for months.
“There’s been nothing to trigger the kind of sell-off we’ve seen yesterday and today,” said Brian Bush, director of equity research at Stephens. “I don’t see a logical explanation, other than just pure nervous speculation and fear.”
Stocks had opened higher after Federal Reserve Chairman Alan Greenspan said in a speech that the economy was weathering the recent jump in energy prices without major disruptions.
Climbing oil prices exacerbated worries about energy costs. A barrel of light crude climbed 59 cents to settle at $64.12 on the New York Mercantile Exchange. “A lot of people who were hoping that when it broke $62 a barrel, it would go back to the $50s are seeing that’s not happening,” said Hank Herrmann, chief executive at Waddell & Reed.
Some investors held off on making large bets until tomorrow, when the consumer price index, a key barometer of inflation, is released by the Labor Department.
While Apple beat Wall Street profit forecasts late Tuesday by a penny a share, revenues came in below forecasts and iPod sales missed expectations. Investors worried holiday sales might also disappoint. Apple tumbled yesterday $2.34 to $49.25.
Intel fell 18 cents to $23.24 after analysts at Prudential downgraded the chip maker’s stock to “underweight” from “neutral weight,” citing potential weakness in revenues and profit margins.