Sector Watch: Networkers Mixed a Day After Cisco's Warning

Cisco's(CSCO Quote) after-hours profit warning Monday wasn't a good sign for the networking heavyweight, but investors displayed mixed emotions about the sector as a whole in today's session.

Cisco was by far the most actively traded stock on the Nasdaq this morning, with more than 106 million shares changing hands by midday. Shares of Cisco dropped $1.20, or 7%, to $15.99 in recent trading. After the bell on Monday, the company said its third-quarter revenue would decline 30% sequentially. Cisco also said earnings should be in the "very low single digit" range. Wall Street expected the company to earn 8 cents a share and post revenue of $5.95 billion.

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Juniper Networks(JNPR Quote) was up 35 cents, or 0.7%, to $48.73, and Redback Networks(RBAK Quote) rose 81 cents, or 4.8%, to $17.90 on the Nasdaq. JDS Uniphase(JDSU Quote) lost 0.5%, and Corning(GLW Quote) traded higher by 0.8%.

Ciena(CIEN Quote) added 4% to $53.60, but Sycamore Networks(SCMR Quote) fell, losing 40 cents, or 4.3%, to $9. Lucent(LU Quote) was off 4.6%, while Nortel(NT Quote) dropped 2%.

"I think its kind of a relief rally. Some analysts think that perhaps we've heard the worst", said Jay Ritter, an analyst with Morningstar. "It was widely expected that Cisco would miss its numbers." Ritter added that "it's still too early to say if corporations and phone companies will start to spend more later in the year." He said he expects the sector to "most likely bump along the bottom until we see some signs that capital spending increases."