Semiconductor makers lost ground across the board in today's action, following research notes from

Lehman Brothers

and

Morgan Stanley

, who offered less-than-optimistic outlooks for the sector.

The ever-volatile chips were trading sharply lower. The

Philadelphia Stock Exchange Semiconductor Index

was down 4.9%. Many of the chip names were down at least 5% since the open, but some took the bulk of the punishment. Hit hardest were the communication chips, such as

Broadcom

(BRCM)

,

PMC-Sierra

(PMCS)

and

Applied Micro Circuits

(AMCC)

. Broadcom, which is down 11.2% in the last month, dropped $3.13, or 8.5%, to $33.76. PMC-Sierra was off $3.04, or 8.7%, to $32.06, and Applied Micro fell $1.84, or 8.9%, to $18.78.

Morgan Stanley analyst Mark Edelstone

lowered his earnings estimates on seven companies, including Broadcom, PMC-Sierra,

Rambus

(RMBS) - Get Report

and

Texas Instruments

(TXN) - Get Report

. Lehman Brothers analyst Dan Niles

reduced his earnings estimates on

Cypress Semiconductor

(CY) - Get Report

,

Micron Technology

(MU) - Get Report

and

SimpleTech

(STEC)

on Wednesday morning, but he maintained his ratings on the companies.

Shares of Micron, which are off 16.3% in the last month, were down $2.17, or 5.7%, to $35.81 in recent

New York Stock Exchange

trading, while Cypress Semiconductor dropped $1.34, or 5.9%, to $21.41, also on the Big Board. SimpleTech was down 45 cents, or 13%, to $3.

Texas Instruments fell $1.99, or 5.4%, to $34.56.

Intel

(INTC) - Get Report

was off 92 cents, or 3.3%, to $26.92, and

Advanced Micro Devices

(AMD) - Get Report

slid 4.3% to $28.17.