The stock market's extreme case of the jitters last week was clearly evident in the technology sector. In fact, after enjoying pretty solid...
The stock market’s extreme case of the jitters last week was clearly evident in the technology sector. In fact, after enjoying pretty solid growth last year, some of the giants among tech companies have traveled a rocky downhill path in 2008.
By some measures, the sector as a whole has fared worse than the broader market. The Amex Technology Select Sector Index of 79 tech companies has declined 14.5 percent since the beginning of the year, compared with a 9.4 percent drop in the S&P 500.
What’s more, as increasingly gloomy news spreads through the larger economy, so have sobering forecasts for tech companies. When Apple reported solid revenue and profit numbers last week, for instance, its share price plunged anyway, mainly because the company’s forecast for business in the short term fell short of Wall Street expectations. The same thing happened the week before to Intel.
Microsoft last week reported strong quarterly numbers and revised its outlook decidedly upward. But, after giving the market an early boost Friday, even that couldn’t stem the downward pressure exerted by a continuing stream of tough financial news.
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Analysts say the markets are demonstrating a high degree of sensitivity right now — it’s on “pins and needles,” one said. No surprise that the techs should experience the same kind of volatility.