Computers did what Alan Greenspan failed to do.
After Monday's 82-point increase and a midday gain of 48, program selling near the end of the session left the
Dow Jones Industrial Average
up a mere 9.31 to 6473.25.
Nasdaq Composite Index
lost 3.72 to 1312.55 and the
slipped 2.22 lower at 747.54, with both indexes losing ground rapidly in the final hour of trading. Reflecting the continued strength of smaller stocks, the
index of small-cap stocks rose 0.81 to 361.30.
Although the semiconductor industry's closely watched book-to-bill ratio came in above expectations after Monday's market close, the
Philadelphia Stock Exchange
Semiconductor Index plunged 5.02 to 247.26 on Tuesday.
"It was a case of the proverbial selling into the good news," says
, director of technical research at
Janney Montgomery Scott
Leading the decline was bellwether
(INTC:Nasdaq), slipping 1 to 129 1/8.
(MU:NYSE), the most active stock on the Big Board, dropped 1 + to 33 7/8 and
(LSI:NYSE) fell 5/8 to 30 7/8.
(CYRX:Nasdaq) took the worst bruising, losing 3 to 19 3/8. The firm's president and chief executive,
, announced that he was resigning.
The tobacco sector continued its move upward amidst analyst upgrades and declining worries about litigation.
(MO:NYSE) rose another 2 + to 116 + and
(RN:NYSE) tacked on 3/8 to 34 +.
In the networking arena,
(BAY:NYSE) lost 1 + to 23 + after new CEO, David House, told an audience at the
Montgomery Securities Technology Conference
that earnings will be flat or near flat for the next two quarters, and that the company was not looking at merger possibilities as has been widely rumored. Other networking stocks fell in sympathy.
(NSCP:Nasdaq) jumped sharply, up 3 to 63, after five Baby Bells agreed to use Netscape's Internet browser for their Internet access services.
The earnings warning season got started early today.
Black & Decker
(BDK:NYSE) was hammered, dropping 6 to 31 5/8, after the company announced that it would not meet expectations over the next couple quarters.
(KMAG:Nasdaq), a supplier of disk drive components, lost 5 7/8 to 27 +. The company said earnings for the fourth quarter would be below the third quarter.
By Avi Stieglitz