The tech sector continued to lead the major market averages on the downside, while the Treasury market remained sharply higher going into the final hour of trading.

The

Nasdaq Composite Index

was down 41 to 2286.

TST Recommends

The 30-year Treasury bond was up 1 5/32 to 95 11/32, yielding 5.57%. The yield on the long bond rose as high as 5.66% intraday yesterday.

The

Dow Jones Industrial Average

was down 47 to 9319.

The

S&P 500

was down 10 to 1235. The

Russell 2000

was down 2 to 391.

TheStreet.com Internet Sector

was up 1 to 509.

TheStreet.com E-Commerce Index

was up 1 to 97.

An attack on

Compaq

(CPQ)

by some Wall Street analysts led in part to the tech sector tumble. Compaq was down 5 7/16, or 13%, 35 9.16, and was most active on the

New York Stock Exchange

with 65 million shares changing hands.

Goldman Sachs'

downgrade of semiconductor company

Micron Technology

(MU) - Get Report

didn't help the tech arena. Goldman downgraded Micron to market outperform and removed it from its recommended list.

Leading tech sector gauges were all sharply lower, particularly computer maker and semiconductor proxies. The

Philadelphia Stock Exchange Computer Box Maker Index

was down 6%, while the the

Philadelphia Stock Exchange Semiconductor Index

was down 9%.

Overall, summing up the situation in techs, Scott Curtis, senior equity trader at

Brown Brothers Harriman

, said: "Techs are bad pretty much across the board."

Looking ahead, a couple of significant pieces of economic data are slated to come out next week, including the

National Association of Purchasing Management's

index and the February

employment report

.

On the

New York Stock Exchange

, decliners were beating advancers 1,623 to 1,243 on 574 million shares. On the

Nasdaq Stock Market

losers were beating winners 2,261 to 1,589 on 679 million shares.

On the NYSE, 83 issues had set new 52-week lows while 13 had touched new highs. On the Nasdaq, 72 issues had set new lows while new highs totaled 27.

On the Nasdaq,

Intel

(INTC) - Get Report

was most active on 346 million shares. It was down 7 11/16 to 120.

2:01 p.m.: Computer, Semiconductor Stocks Lead Tech Downturn

Deep losses in computer and semiconductor stocks highlighted today's tech-sector tumble, while the 30-year Treasury bond has managed to recover some of the ground it has lost this week.

The long bond was up 1 8/32 to 95 14/32, yielding 5.56x%.

The

Nasdaq Composite Index

was down 39 to 2288.

Sliced earnings estimates and downgrades from Wall Street analysts nailed computer maker

Compaq

(CPQ)

and helped fuel the tech sector slide.

Merrill Lynch

and

Credit Suisse First Boston

lowered their first-quarter earnings estimates on the computer maker. Meanwhile,

PaineWebber

downgraded Compaq to neutral from buy.

Donaldson Lufkin & Jenrette

downgraded the company to market perform from buy. Compaq was down 5 5/16, or 13%, to 35 11/16 and was most active on the

New York Stock Exchange

with 59 million shares changing hands.

The

Philadelphia Stock Exchange Computer Box Maker Index

was off 6%.

Not helping the tech sector was a

Goldman Sachs

downgrade of semiconductor maker

Micron Technology

(MU) - Get Report

. Goldman downgraded Micron to market outperform and removed it from its recommended list.

The

Philadelphia Stock Exchange Semiconductor Index

was down 8%.

Meanwhile, the

Dow Jones Industrial Average

was down 60 to 9306. The

S&P 500

was down 11 to 1234. The

Russell 2000

was down 2 to 391.

TheStreet.com Internet Sector

was up 1 to 509, while

TheStreet.com E-Commerce Index

was up 1 to 97. The

American Stock Exchange

said it will be adding

Cyberian Outpost

(COOL)

,

Digital River

(DRIV) - Get Report

and

uBid

(UBID)

to the e-commerce index following the close of trading on March 4, replacing

Hollywood Entertainment

(HLYW)

,

Micro Warehouse

(MWHS)

and

Barnes & Noble

(BKS) - Get Report

. The three additions were not eligible for inclusion in the index when it was created earlier this year, Amex said.

On the NYSE, decliners were beating advancers 1,546 to 1,235 on 494 million shares. On the

Nasdaq Stock Market

losers were beating winners 2,167 to 1,514 on 585 million shares.

On the NYSE, 73 issues had set new 52-week lows while 13 had touched new highs. On the Nasdaq, 59 issues had set new lows while new highs totaled 23.

On the Nasdaq,

Intel

(INTC) - Get Report

was most active on 31 million shares. It was down 6 3/4 to 121.

Meanwhile,

pcOrder.com

(PCOR)

was soaring 25 13/16, or 123%, to 49 13/16 after Goldman priced its 2 million-share IPO top range last night at $21. Elsewhere,

Intraware

(ITRA)

has jumped 4, or 25%, to 20 1/8 after CS First Boston priced its 4 million-share IPO above range at $16 a share.

Sector Focus: Credit Card Issuers

Jeffrey Evanson, senior research analyst at

Piper Jaffray

, today initiated coverage of several credit card issuers. Evanson initiated coverage of

Capital One Financial

(COF) - Get Report

with a strong buy rating, while he rated

American Express

(AXP) - Get Report

,

MBNA

(KRB)

and

Providian Financial

(PVN)

with a buy rating.

Capital One was up 2 9/16 to 126 7/16. American Express was up 1/2 to 108 3/8, MBNA was up 13/16 to 24 7/16, while Providian was up 3 3/16 to 101 11/16.

As of yesterday's close, year to date Providian was up 31.3%; Capital One was up 7.7%; American Express was up 5.2%; while MBNA was down 4.8%.

12:53 p.m.: Midday Musings: Bonds' Bounce Belies Tech-Led Retreat

11:52 a.m.: Tech Sector Continues to Pressure Indices

Treasuries were enjoying sharp gains late this morning while the technology sector is taking a beating.

The 30-year Treasury bond was up 1 11/32 to 95 19/32, yielding 5.56%.

The

Nasdaq Composite Index

was down 31 to 2296.

The

Dow Jones Industrial Average

was down 47 to 9320. The

S&P 500

was down 8 to 1237. The

Russell 2000

was down 1 to 392.

TheStreet.com Internet Sector

was up 2 to 510.

TheStreet.com E-Commerce Index

was up 1 to 97.

On the

New York Stock Exchange

, decliners were beating advancers 1,361 to 1,265 on 309 million shares. On the

Nasdaq Stock Market

, losers were beating winners 1,834 to 1,460 on 379 million shares.

On the NYSE, 46 issues had set new 52-week lows while 13 had touched new highs. On the Nasdaq, 43 issues had set new lows while new highs totaled 21.

On the Big Board,

Compaq

(CPQ)

was most active with 44 million shares changing hands. It was down 5 1/8, or 13%, to 35 7/8.

On the Nasdaq,

Intel

(INTC) - Get Report

was most active on volume of 21 million shares. It was down 7 7/16 to 120 5/16. More on Intel below.

Tech Focus

Today

Merrill Lynch

and

Credit Suisse First Boston

lowered their first-quarter earnings estimates on Compaq, helping the rest of the tech sector on the downside. Meanwhile,

PaineWebber

downgraded Compaq to neutral from buy.

Donaldson Lufkin & Jenrette

downgraded the computer maker to market perform from buy.

The

Philadelphia Stock Exchange Computer Box Maker Index

was down 6%.

Among the other tech gauges, the

Philadelphia Stock Exchange Semiconductor Index

was down 7%. Elsewhere, the

Morgan Stanley High-Tech 35

was down 3%, while the

Nasdaq 100

was down 2%.

Meanwhile,

Goldman Sachs

downgraded semiconductor company

Micron Technology

(MU) - Get Report

to market outperform from the firm's recommended list. Micron was down 8 7/16, or 13%, to 58 3/8.

In the Newsletters

In response to privacy concerns over a processor serial number that is burned in to

Intel's

(INTC) - Get Report

Pentium III

chips,

IBM

(IBM) - Get Report

said it would disable the ID feature in the Pentium III computers it sells, an article on

Computerworld's

Web site said.

Intel has been embroiled in controversy since last month over its plans to put a serial number on all Pentium III processors, which will be available in systems starting today, the article said.

Meanwhile, a civil liberties group said yesterday it plans to file a complaint with the

Federal Trade Commission

today alleging the upcoming release of Pentium III is an unfair and deceptive trade practice.

IBM was down 5 1/2 to 168 1/8.

11:03 a.m.: Tech Sector Continues to Suffer

The technology sector was suffering sizable losses at midmorning, while the 30-year bond was rebounding handsomely after suffering huge losses for three straight sessions.

The benchmark 30-year Treasury bond was up 1 13/32 to 95 19/32, yielding 5.55%, thanks in part to bargain hunters.

Meanwhile, the

Nasdaq Composite Index

was down 31 to 2296.

Tech stocks were getting buried, particularly semiconductor and computer maker issues.

The

Philadelphia Stock Exchange Semiconductor Index

was down 6%, while the

Philadelphia Stock Exchange Computer Box Maker Index

was down 5%.

The tech stocks are weak today as news on

Compaq

(CPQ)

has affected the whole group, said Ricky Harrington, senior vice president and technical analyst at

Interstate/Johnson Lane

.

Today

Merrill Lynch

and

Credit Suisse First Boston

today lowered their first-quarter earnings estimates on the computer maker. Meanwhile,

PaineWebber

downgraded Compaq to neutral from buy.

Compaq was down 4 3/4, or 11%, to 36 1/4. It was the most active stock on the

New York Stock Exchange

with 33 million shares changing hands.

Over the last two or three weeks, the losses tech stocks have incurred are great enough to bring into question whether they've made intermediate-term tops, Harrington said.

"I think what the market has been telling us is that you don't need a great deal of negative news for the market to go down," he said.

The character of the market has changed lately, Harrington noted, pointing out that there has not been much leadership and that that leadership is fragmenting.

The

Dow Jones Industrial Average

was down 26 to 9340. The

S&P 500

was down 7 to 1238. The

Russell 2000

was down 1 to 392.

TheStreet.com Internet Sector

was up 4 to 512.

TheStreet.com E-Commerce Index

was fractionally at 96. The

American Stock Exchange

said it will be adding

Cyberian Outpost

(COOL)

,

Digital River

(DRIV) - Get Report

and

uBid

(UBID)

to the e-commerce index following the close of trading on March 4, replacing

Hollywood Enterntainment

(HLYW)

,

Micro Warehouse

(MWHS)

and

Barnes & Noble

(BKS) - Get Report

. The three additions were not eligible for inclusion in the index when it was created earlier this year, Amex said.

As for the direction of the rest of the session, Harrington said it is impossible to predict what is going to happen. He said he wouldn't be surprised to see a rebound in the market. The market is down quite a bit over the last couple of days and the market could see some short covering this afternoon, he said.

Harrington said over the next 60 days the market is more susceptible to additional bad news.

Despite the plethora of negatives, there are some positives in the market.

On the plus side, the Dow hasn't broken the 9100 level and there is still money on the sidelines, Harrington said.

On the NYSE, decliners were beating advancers 1,255 to 1,220 on 225 million shares. On the

Nasdaq Stock Market

losers were beating winners 1,705 to 1,307 on 285 million shares.

On the NYSE, 38 issues had set new 52-week lows while 11 had touched new highs. On the Nasdaq, 39 issues had set new lows while new highs totaled 19.

On the Nasdaq,

Intel

(INTC) - Get Report

was most active on volume of 16 million shares. It was down 6 13/16, or 5%, to 121.

9:56 a.m.: Stocks Down Modestly as Bonds Surge

The 30-year Treasury bond has retraced most of the losses it suffered yesterday and was up sharply this morning as stocks opened down.

There was more good news about the economy this morning. The

Commerce Department

said

gross domestic product

advanced at a revised 6.1% annual rate in the fourth quarter, up from the original estimate of 5.6%.

The long bond shrugged off the news and bottom feeders flooded the market. The benchmark Treasury was up 1 5/32 to 95 11/32, yielding 5.572%.

The

Dow Jones Industrial Average

was down 15 to 9351. The

S&P 500

was down 4 to 1241.

The

Nasdaq Composite Index

was down 28 to 2298. The

Russell 2000

was down fractionally at 392.

TheStreet.com Internet Sector

was down 5 to 502.

TheStreet.com E-Commerce Index

was down fractionally at 96.

Most Up at Open -- NYSE

Albertson's (ABS) , up 1 7/8 to 56

.

Most Up at Open -- Nasdaq

eBay (EBAY) - Get Report, up 8 to 307 1/2

.

Most Down at Open -- NYSE

DuPont (DD) - Get Report, down 1/2 to 52 11/16

.

Most Down at Open -- Nasdaq

Intel (INTC) - Get Report, down 3 7/8 to 123 7/8

: A civil liberties group said yesterday it plans to file a complaint with the

Federal Trade Commission

today alleging the upcoming release of Intel's

Pentium III

chip is an unfair and deceptive trade practice.