Nasdaq Leads Broad Selloff as Tech Sector Takes a Big Hit

The losses came despite another round of earnings reports that mostly surpassed Wall Street expectations.
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The technology-heavy

Nasdaq Composite Index

plunged 3.5% and suffered the fourth-largest point decline in its history as tech stocks led the market deep into the red in a broadbased selloff.

The

Nasdaq 100

swooned 3.9%, the

Philadelphia Stock Exchange Computer Box Maker Index

tumbled 3.9%, while the

Philadelphia Stock Exchange Semiconductor Index

dropped 4.5%.

The

Dow Jones Industrial Average

was dragged down the most by computer makers and financials. The biggest loser in the average was

IBM

(IBM) - Get Report

, which fell 6 5/8, or 5%, to 128. Other prominent Dow losers:

Hewlett-Packard

(HWP)

,

American Express

(AXP) - Get Report

and

J.P. Morgan

(JPM) - Get Report

.

The losses came despite another round of earnings reports that mostly surpassed Wall Street expectations. Market participants cited jitters over earnings in the second half of the year, profit-taking, and skittishness ahead of

Federal Reserve

Chairman

Alan Greenspan's

testimony on Thursday as some of the reasons for the selloff. Some players said the market was selling on the news of the good earnings that have been coming out after having already priced in strong profit numbers.

On the

New York Stock Exchange

, decliners beat advancers 2,044 to 869 on 756.5 million shares. On the

Nasdaq Stock Market

, losers beat winners 2,775 to 1,210 on 1.07 billion shares.

On the NYSE, 45 issues set new 52-week lows while 44 touched new highs. On the Nasdaq, 75 issues set new 52-week highs while new lows totaled 42.

On the Big Board,

Lucent

(LU)

was most active, with 33.1 million shares changing hands. It was down 6 57/64, or 9%, to 69 15/16. Lucent posted third-quarter earnings of 26 cents a share, excluding charges, better than the

First Call

27-analyst prediction of 23 cents and up from the year-ago 17 cents, which excludes charges.

On the Nasdaq,

Microsoft

(MSFT) - Get Report

was most active, with 46 million shares changing hands. Microsoft was down 5, or 5.1%, to 93 5/16. After the close yesterday, Microsoft posted earnings of 40 cents a share in the quarter ended June 30, 4 cents better than the First Call 26-analyst estimate of 36 cents and up from the year-ago 25 cents, but warned of a revenue slowdown for fiscal 2000.

TheStreet.com

wrote about the earnings report

last night.

Market data above are preliminary. Updated numbers and analysis will follow in the Market Roundup

Earlier...

2:55 p.m.: Tech-Heavy Nasdaq Continues to Lead Big Tumble

The

Nasdaq Composite Index

was suffering huge losses as technology stocks continued to lead the market lower as the final hour of trading approached.

2:10 p.m.: Stocks Remain Stuck Deep in Negative Territory

Although today's tech-sector selloff has been one of the uglier ones in recent memory, a decent portion of market participants have for the most part taken the tumble in stride, considering the market's outsized gains.

1:20 p.m.: Midday Musings: Traders Fiddle While Techs Burn

12:13 p.m.: Nasdaq Hit Hard in Broad Decline

Major indices all continued to trade off last week's highs heading into the afternoon, with the

Nasdaq Composite Index

hardest hit.

10:57 a.m.: Stocks Remain in Negative Territory Despite Bullish Earnings Reports

Microsoft

(MSFT) - Get Report

,

IBM

(IBM) - Get Report

and

Lucent

(LU)

rank number one, three and four in the

S&P 500

, so when those stocks get whacked, the index takes a hit.

9:58 a.m.: Stocks Move Further From Friday's Record Levels

The technology stock-laden

Nasdaq Composite Index

was leading the market on the downside in the early going as stocks retreated further from the record levels set Friday.