Tech Stocks Taken Apart
Updated from 4:05 p.m. EST
Stocks dropped again Monday as selling pressure built throughout the session and swept across practically every area of the market.
The Dow Jones Industrial Average was down 172.65 points, or 1.29%, to close at 13,167.20. Twenty-six of the Dow's 30 components finished with losses, with Caterpillar (CAT) one of the biggest decliners, down 3%
Earlier, Morgan Stanley downgraded the construction-equipment maker to underweight from equal-weight, forecasting dwindling sales in 2008.At the same time, the S&P 500 was off 22.05 points, or 1.5%, at 1445.90. The Nasdaq Composite lost 61.28 points, or 2.32%, at 2574.46. Big-cap tech stocks were particularly sluggish. Intel (INTC), Microsoft (MSFT) and Cisco (CSCO) each fell roughly 2%. Apple (AAPL) lost 3.2%, and Research In Motion (RIMM) slid 5.2%. "We have the same list of concerns we've had for a while now," said Art Hogan, chief market analyst with Jefferies. "Everyone is predicting a slowdown domestically and globally, but no one expected a pickup in inflationary pressures. If we continue to see a slowing economy and rising inflation, it's a huge problem for equities." Breadth and volume were poor to start the week. On the New York Stock Exchange 3.48 billion shares changed hands, as decliners toppled advancers by a 4-to-1 margin. Volume on the Nasdaq reached 1.85 billion shares, with losers beating winners 3 to 1. Traders were bracing for quarterly results from some big finance names, as fears swirled over what each will say about subprime mortgage-related losses.
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