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The

Nasdaq Composite Index reversed its recent habit of starting out strong and falling back. As a result, tech investors were much happier by the end of the session.

Scattered action in futures trading gave way to a negative open as another round of profit warnings from computer and software companies roiled the sector. Shortly after noon, the Comp broke into the green, dipped briefly and then rose again. At the end of the day, the gains were nothing to write home about. But hey, at least it's not red. The Comp is still down 13.4% for the year.

Internet stocks performed well with

TheStreet.com Internet Sector

index posting a 2.4% gain. Among the standouts were

America Online

(AOL)

, up almost 6% and

Yahoo!

(YHOO)

up 4.7%. AOL's gains came despite news that Federal regulators are expanding their review of AOL's proposed merger with

Time Warner

(TWX)

to include television set-top boxes.

Amazon.com

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TheStreet Recommends

(AMZN)

managed to recover from a preopen trading dip after

Robertson Stephens

analyst Lauren Cooks Levitan said she doubted the company could ever turn a profit with its present business model. Amazon also announced an alliance with privately held photo-finisher

Ofoto

. It ended the day up 94 cents to $36.

E-business software companies

Calico Commerce

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and

Saga Systems

(AGS)

got slapped after warning upcoming earnings will miss estimates because of delayed deals among other factors. Calico slid 31.3%, while Saga sank 32.1%.

Somehow,

Computer Associates

(CA)

was able to escape the same treatment, perhaps because its expected miss is by such a narrow margin. The more likely explanation is that the news of an earnings warning for the second consecutive quarter wasn't exactly shocking in the way bad news from

Apple

(AAPL)

and

Intel

(INTC)

can send the market -- and particularly the tech portion -- into a major tailspin. Computer Associates rose $3.63, or 14.8%, to $28.06. Go figure.

Oplink Communications

(OPLK)

made a splash in its trading debut, shooting up $15.63, or 86.8%, to $33.63. The San Jose-based company's fiber-optic components and optical modules are designed to boost the performance of optical networks.

Other optical networking stocks enjoyed some upside, particularly

JDS Uniphase

(JDSU)

which popped $6.44, or 7.4%, to $94.06.

Semiconductor stocks also helped pull the tech sector into the green, thanks largely to high hopes for

Micron Technology

(MU)

which is scheduled to report earnings after the close. The stock rose 10.3%, while the

Philadelphia Stock Exchange Semiconductor Index

popped 6.2%.

Intel

(INTC)

gained 4.2% to $42.

Among stocks with the largest gains on the Nasdaq today were B2B company

Ariba

(ARBA)

, up 15.4% and

Broadcom

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, up 7.9%, to $241.94.

3:58 p.m.: Semis Lead the Tech Rebound, Though Warnings Persist

Technology stocks, which took it on the chin yesterday, have staged a decent recovery in afternoon trading.

News that the

Federal Reserve had decided to maintain its tightening bias, added to serious concerns about corporate profits, sent the

Nasdaq down 3.2% Tuesday. The tech-laden index dropped below 3521 -- the intraday low of Aug. 3 -- a level that many technical analysts hoped would bring bargain hunters back into the market.

Today buyers looking for a steal have shown up, but there is still a ways to go before technology investors can feel good about things.

Still, the companies making strides today are worth noting. Chip maker

Micron Technology

(MU)

, which posts fourth-quarter earnings after the bell, was lately ahead 8.1%. The

Philadelphia Stock Exchange Semiconductor Index

was gaining 6.4%.

Shares of semiconductor manufacturer

Novellus Systems

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were up an impressive 13%. Also lifting the SOX were

KLA-Tencor

(KLAC)

, up 9.8%, and

Motorola

(MOT)

, ahead 8.3%.

After tanking 12% yesterday, shares of

Oracle

(ORCL)

have continued to slide 1.9% in recent action. Following a company meeting yesterday with Wall Street analysts,

Robertson Stephens

analyst Eric Upin downgraded the software giant to long-term attractive from buy.

In his research note, Upin wrote that "although we recognize Oracle as one of the pre-eminent names in the software space and a technology bellwether, it is difficult to make an argument for the stock to move meaningfully higher over the near term."

Merrill Lynch

today reiterated its intermediate-term accumulate and long-term buy rating on the database software manufacturer but noted that Oracle "is not immune to the general deterioration in market psychology."

Bear Stearns

also reiterated its buy rating.

Shares of

Microsoft

(MSFT)

, which hit a new 52-week low yesterday, have slipped an additional 1.4%. Meantime,

Apple

(AAPL)

was up 5.1%.

By now investors know that an earnings warning is certain to slice a stock's value. Today

BMC Software

(BMCS)

fell on the heels of a profit confession. The software manufacturer announced that it expects second-quarter earnings to come in below Wall Street expectations, with revenues down from the first quarter and a year earlier. The company predicts that it will post a 10-to-12-cent result, compared with the analyst prediction of a 24-cent profit. BMC Software was lately trading down 7.1%.

On the flip side, software company

Peregrine Systems

(PRGN)

advanced 26.2% after saying that second-quarter results would meet or beat the Street's estimate of 11 cents per share.

In the Net corner, shares of

Yahoo!

(YHOO)

,

eBay

(EBAY)

, and

Amazon.com

(AMZN)

were all up more than 5%.