Today's Market: Stocks Stumble on Nokia Warning - TheStreet

(Updated from 9:55 a.m. EDT)

A wrong number from a mobile-phone outfit is wreaking havoc on the markets this morning.

Mobile-phone maker

Nokia

(NOK) - Get Report

warned it would fall short of its second-quarter targets, and the bears -- fretting over earnings warnings -- took over Wall Street. Both tech and blue-chip stocks headed down at the open.

The

Nasdaq Composite Index was lately down about 50 points to 2121; the

Dow Jones Industrial Average was off some 88 points to 10,834; and the broader

S&P 500 index was down some 13 points to about 1241.

"Nokia's warning will definitely affect that entire sector," said Jay Meagrow, vice president of trading at

McDonald

. Meagrow thinks the market will likely turn its focus on

Kraft Foods

(KFT)

tonight, but doesn't think the highly anticipated IPO will be positive catalyst enough for this market. "I don't see any positive catalysts. It should be a choppy week that trends to the downside," he said.

Indeed, Nokia was off 19.5% to $23.11 in early trading, and rivals

Ericsson

(ERICY)

, off almost 7% to $5.12, and

Qualcomm

(QCOM) - Get Report

, down by 6.8% to $55.72, were falling in sympathy.

Over the past two days, stocks have fallen on the back of profit warnings from corporate America, particularly in the tech sector. Investors are worried that the second-half recovery they're betting on is becoming

less likely. Over Friday's and Monday's sessions, the Dow dropped 1.5%, the Nasdaq fell 4.1% and the S&P 500 lost 1.8%.

Some upbeat news took the spotlight early this morning.

Dell

(DELL) - Get Report

was upgraded to outperform from neutral by Morgan Stanley, pushing the PC maker's stock up 1.4% to $25.59 so far this morning. And Kraft raised the price range for its

IPO, which is scheduled for Wednesday, up to $30 to $31 from $27 to $30. Tobacco giant

Philip Morris

(MO) - Get Report

will let go of a 16% stake in the big foodmaker. At the top end of the new range, the IPO would bring in $9.03 billion for Philip Morris. The funds will be used to pay down debt at the tobacco company, whose stock was lately trading 1.2% higher to $49.11.

But the morning's news was overwhelmingly negative and outweighing the positive. Nokia said it expected second-quarter sales growth below 10% year over year, and that it's examining its outlook for the second half.

And a round of profit warnings hit Wall Street last night. Biotech-equipment maker

Affymetrix

(AFFX)

said it would

fall short of Wall Street estimates for the second quarter, citing slower-than-expected sales. The company's shares were down 33.7% to $27.17 in early trading. And

Hughes Electronics

(GMH)

, the company behind the

DirecTV

home satellite services, said that it would

miss subscriber growth forecasts for the second quarter and the rest of the year. Hughes, a unit of

General Motors

(GM) - Get Report

, cut revenue forecasts for the full year, though it boosted the low end of its estimated range for full-year earnings before interest, taxes, depreciation and amortization. Shares of Hughes were falling 7.5% to $20.90 in recent trading.

There was also a dour outlook for a trio of tech companies from

Credit Suisse First Boston

this morning, which lowered its estimates on Affymetrix, chip-equipment maker

Anadigics

(ANAD)

, and chipmaker

Varian Semiconductor

(VSEA)

. Anadigics was lately down 5.2% to $18.94; Varian was off 0.4% to $39.10.

And the

Federal Drug Administration

this morning denied approval for

Amgen

(AMGN) - Get Report

and

Praecis'

(PRCS)

joint prostate-cancer treatment. Amgen was lately off 4.4% to $63.80, while Praecis was diving 35.2% to $14.63.

So far, this quarter's confession season has been mostly negative. During confession season, companies let the market know if they expect to miss financial performance targets. Wall Street is hoping corporate profits will begin to reaccelerate during the fourth quarter of this year, but the outlook for a turnaround is still pretty murky.

The list of bad news bears is long: Computer-server maker

Sun Microsystems

(SUNW) - Get Report

, PC maker

Hewlett-Packard

(HWP)

, financial powerhouse

J.P. Morgan Chase

(JPM) - Get Report

, networkers

Broadcom

(BRCM)

and

3Com

(COMS)

, handheld device maker

Handspring

(HAND)

and chipmaker

Lattice Semiconductor

(LSCC) - Get Report

, among others.

Varian Semiconductor and

Juniper Networks

(JNPR) - Get Report

also have warned they would miss second-quarter targets.

Only

Intel

(INTC) - Get Report

and

Xilinx

(XLNX) - Get Report

have issued optimistic outlooks.

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Bonds/Economy

Treasury prices were strong again this morning. The benchmark 10-year

Treasury note was lately up 5/32 to 97 31/32, while yields had slipped to 5.268%. Prices on the 30-year note were climbing 4/32 to 95 20/32, and yielding 5.680%.

Treasuries climbed Monday amid the weakness in equities and more signs of economic slowing in Japan, which experts believe could hurt the chances for a quick U.S. recovery and lead the

Federal Reserve to continue lowering interest rates.

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International

Techs, telecoms and banks were weighing on the European indices in morning trading. London's

FTSE 100

was showing minor losses, lately down 1.18% to 57931.3. The

CAC-40

in Paris was falling 1.7% and Frankfurt's

Xetra Dax

was moving 1.59% lower. But

Deutsche Telekom

(DT) - Get Report

was rising after it announced plans to cooperate with

British Telecom

(BTY)

on the rollout of third-generation mobile technology.

The euro was lately trading at $0.8481. The dollar was trading at 121.69 yen.

Monday's reported weaker-than-expected quarterly GDP data for Japan and weakness on the Nasdaq continued to pressure Asian markets. Tokyo's

Nikkei 225

closed down 386.38 points, or 2.92%, to 12,840. Hong Kong's

Hang Seng

closed down 148.81, or 1.09%, to 13,526.68.

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