The stock market has already priced in a victory for former First Son

George W. Bush

, so now traders and investors were back to focusing their attention on the slowing economy and crummy fourth-quarter earnings. Hooray!

This morning, the

Dow Jones Industrial Average and the

Nasdaq Composite Index got off to a rallying start after hearing the

U.S. Supreme Court

ruling last night. The Dow was up over 100 points earlier in the session, but quickly pulled back. The Comp, though, tumbled back into the comforts of the downside, where it ended the day yesterday.

Techs were again in the middle of the mess, with computer-maker, semiconductor and Internet stocks all out of favor.

A multitude of warnings from tech-related stocks and negative research notes were the catalyst for today's Comp selloff.

The biggest came from

Compaq

(CPQ)

, which issued a

profit warning, saying that revenue and earnings for the fourth quarter ending Dec. 31 will be 8% to 10% below Wall Street's expectations.

It was the latest component of the

Philadelphia Stock Exchange Computer Box Maker Index

, down 4.7%, to warn that its earnings would miss estimates. It's already been hit by bad news from

Apple

(AAPL) - Get Report

,

Gateway

(GTW)

,

Hewlett-Packard

(HWP)

and

Dell

(DELL) - Get Report

. In recent trading, Gateway was the only one of the group rallying. It ended 0.5% higher to $17.68.

Slowing PC sales were also dragging another sector down, namely, semiconductors. The

Philadelphia Stock Exchange Semiconductor Index

was off 6.5%. Semis got a double dose of yuck. One from

ON Semiconductor

(ONNN)

, which had its own post-close confession of missed earnings yesterday. The stock dropped 24.6% to $6.59.

The other punch to the semis was delivered by

Salomon Smith Barney

, which released a note today that cut ratings on such semis as

Axcelis Technologies

(ACLS) - Get Report

,

Novellus Systems

(NVLS)

,

Applied Materials

(AMAT) - Get Report

and

KLA-Tencor

(KLAC) - Get Report

.

Others in confession mode that helped pull down the Nasdaq were integrated circuit-maker

Actel

(ACTL)

, computer systems maker

RadiSys

(RSYS) - Get Report

and Internet consulting firm

Razorfish

(RAZF)

.

Not everything bad on the Comp was tech-related, though.

Palm Harbor Homes

(PHHM)

, which makes manufactured home, was tanking after an earnings warning. It was down 18.4% to $13.

Pizza restaurant chain

Papa John's

(PZZA) - Get Report

was another non-tech Comp loser today. It said that it would miss earnings because of slower sales, fewer restaurant openings and lower margins. It lost some dough on the news. Lately, it was 18.4% lower to $21.88.

Meanwhile on the Dow, the main drag came from tech, with H-P,

IBM

(IBM) - Get Report

and

Intel

(INTC) - Get Report

in the red.

J.P. Morgan

(JPM) - Get Report

was flying high again today. Lately, it's basked in the glow of hopes of an interest-rate cut. Monday, the stock got the

Fed's blessing to go forward with its marriage to

Chase Manhattan

(CMB)

and today, the two love-birds announced they were coordinating their fourth-quarter dividends so that their stockholders won't miss out on their dividend amid the merger mayhem.

Sector Watch

Despite today's

retail sales report, which showed that sales slowed more than expected in November, the

S&P Retail Index

has held up pretty well. At last look, the index was down only 1.1%. Shares of

Gap

(GPS) - Get Report

fell 1.5% to $25.44, while

Wal-Mart

(WMT) - Get Report

lowered 3% to $50.31.

Drug stocks, which are expected to benefit from a Bush presidency, gained territory. The

American Stock Exchange Pharmaceutical Index

popped 2.4%.

Pfizer

(PFE) - Get Report

advanced 4.1% to $45.81, while

Schering-Plough

(SGP)

improved 3.8% to $57.88.

Tobacco companies, also expected to profit from a Bush administration, did well in late-day trading. The

American Stock Exchange Tobacco Index

boosted 4%. Shares of litigation-dogged

Philip Morris

(MO) - Get Report

popped 6.6% to $40.81.

Weakness in airline stocks has slapped the transport sector with losses this afternoon. At last glance,

Dow Jones Transportation Average

dropped 2% to 2847.

American Airlines

(AMR)

lowered 3.6% to $37.25, while

United Airlines

(UAL) - Get Report

lost 1.6% to $37.63.

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Bonds/Economy

Treasury prices are higher on light volume, with about half of the gains coming after the release of data showing that consumer spending on goods fell sharply in November, signalling that economic growth may continue to slow.

The benchmark 10-year

Treasury note lately was up 15/32 at 103 14/32, dropping its yield to 5.292%.

Treasuries rose in spite of predictions that a Supreme Court ruling in favor of Republican presidential candidate

George W. Bush

would have the opposite effect. Because Bush is seen as the preference of stock investors, and because he is seen as likely to run smaller federal budget surpluses than Democratic candidate

Al Gore

would have, a ruling that effectively makes Bush the victor was expected to have at least a small negative effect on the bond market.

The November

retail sales

(

definition |

chart |

source

) report showed a 0.4% decline in consumer spending on goods, widely missing economist predictions that it would rise slightly. Even though the bulk of the decline was in auto sales (excluding autos, retail sales rose 0.2%), the report suggests that the pace of consumer spending is slowing, leading the entire economy to a slower growth rate.

That increases bond investor optimism about the prospect that the

Fed will lower interest rates in the months ahead. Traders of

fed funds futures have upgraded the odds that the Fed will lower the key short-term interest rate to 6.25% from 6.5% currently by the end of January to nearly 100% from 88%.

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