It isn't too pretty out there.

With the next quarter's doomsayers emerging so soon, and whispers of

Nasdaq 2000 settling over Wall Street, the major indices took a spill at the open. The Nasdaq was already at levels it hadn't seen since January 1999, the

S&P 500 is very nearly in a bear market for first time in 10 years and the

Dow is down 2.4% on the year.

Still, it's not over yet. The major indices tried to pull off a rally yesterday afternoon, however unsuccessfully.

And networking giant

Sun Microsystems

(SUNW) - Get Report

revised fiscal third-quarter earnings and revenue guidance after the close of regular trading yesterday. Sun was the most actively traded stock on the Nasdaq, falling 3.6% to $20.13.

Mobile-phone maker

Motorola

(MOT)

warned this morning it will miss already lowered first-quarter earnings estimates and might even post a loss. Motorola was off 5.9% to $16.28, and was one of the top three most-actively traded stocks on the

New York Stock Exchange.

Of course, Sun's news was really no shock. The company's shares have plunged over the last week as

investors worried that Sun would make just such an announcement on its regularly scheduled quarterly call. But analysts were

backpedaling on the stock this morning.

Goldman Sachs

, which has the stock on its recommended list,

Credit Suisse First Boston

, which rates it a buy, and

Lehman Brothers

, which rates it strong buy, have done the usual, cutting estimates to reflect company guidance. They all maintained their existing ratings.

Things remained weak all across tech and telecom, financials were weak and even the defensive sectors weren't getting much of a boost. Specialty chipmakers

Altera

(ALTR) - Get Report

and

Xilinx

(XLNX) - Get Report

were falling after being

downgraded by Lehman Brothers. Altera was falling 3.6% to $25.19 and Xilinx was off 4.9% to $40.75. The

Philadelphia Stock Exchange Semiconductor Index

was down 3.6%. PC makers and Internet stocks were also down, while biotech was only marginally lower.

The networkers were getting hit after

Morgan Stanley Dean Witter

cut its price target on sector darling

JDS Uniphase

(JDSU)

to $50 from $95. JDS was falling 3.3% to $29.56,

Nortel

(NT)

, which warned of slowing in coming quarters late last week, was falling 3% to $19.34. And

Alcatel

(ALA)

and

Nokia

(NOK) - Get Report

, which saw their ratings cut by Goldman Sachs, were sliding 7.1% and 7.4%, in that order.

The

blue-chip

Dow was getting hit hardest by bellwether

IBM

(IBM) - Get Report

, after

Salomon Smith Barney

cut the company's price target, to $135 from $140 and shaved its third-quarter sales and profit targets. IBM was cutting 30.8 weighted points from the Dow. Two-thirds of the index's 30 stocks were in the red, while

Microsoft

(MSFT) - Get Report

was contributing the most upside; the stock was up 2.2% to $56.38. Another Dow component, automobile giant

General Motors

(GM) - Get Report

was up 0.7% after announcing it

expected it to meet its year-end targets.

Communications equipment and software giant

Lucent

(LU)

was also a popular trade this morning, and was among the top three most-actives on the NYSE. Lucent was up 1% after announcing this morning that it has successfully secured $6.5 billion in new financing. Lucent, which has faced more than its share of

financial woes, said it secured credit facilities of up to $4.5 billion from

J.P. Morgan

and Salomon Smith Barney. Some of this sum replaces earlier expired facilities, while a portion of the debt will be assumed by spinoff

Agere Systems

following its

initial public offering. The remaining $2 billion includes an amendment to a credit line that had been due in 2003.

Investors have begun to doubt earlier predictions that the economy and earnings are destined recover in the second half of this year. A new round of major earnings warnings in the past month has pushed some pros to start looking farther out.

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Sector Watch

Gold stocks seemed to be the only ones making a significant move up this morning. The

Philadelphia Stock Exchange Gold and Silver Index

was up 2.8%.

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Bonds/Economy

The benchmark 10-year

Treasury note was up 12/32 to 99 5/32, yielding 5.109%.

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