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The two major indices diverged earlier in the session, leaving the Dow sorry that it couldn't travel along the Nasdaq's upside trading trail. But investors found that the grass wasn't any greener on the tech side, as the Nasdaq also encountered a downward turn. With no follow-through from yesterday's rally, the market's recent volatile performance has investors stumped as to which investments will make the difference.

With the Dow and the Nasdaq giving back some of their 200-plus-point gains of yesterday, the market's bulls had little to cheer. Sectors across the board continued to suffer from the selling pattern that has continued after a session pops to the plus side. So where are investors taking cover?

"Companies that have had good conference calls and provided a good outlook, like

EMC

(EMC)

and

Sun Microsystems

(SUNW) - Get Sunworks, Inc. Report

," said Brian Gilmartin, portfolio manger at

Trinity Asset Management

. Gilmartin noted that these stocks are producing results, and therefore are trading close to the 52-week highs.

The buy-low-sell-high philosophy was reflected in early-morning trading, as investors jumped on stocks that have been beaten down in recent sessions, "Investors snapped up some stocks at bargain prices," said Jim Herrick, head of trading at

Robert W. Baird

in Milwaukee. "Good earnings particularly in tech have provided some leadership."

Lately, the Nasdaq was falling 33, or 0.9%, to 3678 1/2. The Comp remains 8.8% in the red for the year.

In Nasdaq trading,

TheStreet Recommends

F5 Networks

(FFIV) - Get F5, Inc. Report

was getting pummeled 16 49/64, or 28.6%, to 41 15/16, after posting earnings in line with the

First Call/Thomson Financial

consensus estimate.

JDS Uniphase

(JDSU)

continued to climb on news of strong earnings report and a 155% increase in sales.

In the past, Wall Street has used earnings as a guide to making sound investments. But after tech investors decided to get out of the kitchen before getting burned by their hot holdings, market insiders are now demanding not only strong earnings, but also solid revenue growth.

"For all the high P/E tech stocks, revenue is more critical than earnings because they're in their early stages of growth cycle, Gilmartin said. "Earnings can be manipulated by a lot of things -- a change in depreciation, expense removal -- and that's harder to do with revenues."

Yesterday, investors punished

Exodus Communications

(EXDS)

, after the company surpassed earnings expectations but failed to produce acceptable revenue.

Compaq

(CPQ)

is also receiving the cold shoulder. The computer maker's earnings beat the Street, but it posted near-flat revenue.

"You need to see where the money is coming in the door, especially how the revenue is booked." said Brian Belski, chief investment strategist at

George K. Baum

in Kansas City, Mo. "It's testimony to the success of their products and services."

The revenue gauge is particularly important useful for selecting stable Internet investments. Large-cap tech investors like Gilmartin use revenues to determine which of these new economy investments will come out on top in the wake of the Web boom. "

Amazon

(AMZN) - Get Amazon.com, Inc. Report

uses its book business as a cash cow and is reinvesting in faster-growth businesses tangential to the e-tailing concept," he said. "One way to make sure that this is successful is to watch its revenue."

Amazon is set to release its first-quarter results and guidance report after today's close.

Elsewhere in techland,

TheStreet.com Internet Sector

index was off 2, or 0.3%, to 816, after its 8.2% bounce yesterday.

The Dow Jones Industrial Average was slipping 154 1/2, or 1.4%, to 10,970. At yesterday's close, the Old Economy indicator was still down 3.2% for the year.

Procter & Gamble

(PG) - Get Procter & Gamble Company Report

was helping to hold the index in negative territory, after the consumer giant provided a bleak outlook along with its first-quarter earnings.

3M

(MMM) - Get 3M Company Report

and

Intel

(INTC) - Get Intel Corporation Report

also were dragging the index downward.

On the Big Board, oil stocks' earnings reports were fueled by higher oil prices.

Chevron

(CHV)

was advancing 1 1/16, or 1.3%, to 85 7/8, after its first-quarter earnings quadrupled its year-ago report. The

American Stock Exchange Oil & Gas Index

gained 0.4%.

Scientific-Atlanta

(SFA)

was jumping 5 3/4, or 10%, to 63 1/4, after the company topped the analyst estimate by 3 cents and posted a rise in revenue.

SG Cowen

lifted the stock to strong buy from buy.

The broader

S&P 500

was slipping 10 1/2 to 1467, while the small-cap

Russell 2000

was off 1 1/2 to 487 1/2.

Market Internals

Breadth was negative on both the New York Stock Exchange and the Nasdaq on moderately light volume.

New York Stock Exchange:

1,365 advancers, 1,422 decliners, 612 million shares. 47 new 52-week highs, 30 new lows.

Nasdaq Stock Market:

1,855 advancers, 2,037 decliners, 981 million shares. 36 new highs, 60 new lows.

For a look at stocks in the midsession news, see Midday Stocks to Watch, published separately.