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On Wednesday, the Commerce Department released the bad news that U.S. durable goods orders, excluding transportation, fell 0.1% instead of rising 1.8% as predicted. It was the second-consecutive monthly decline in this business-spending barometer.

As a result, it was a tough week for the technology sector -- although a few tech funds did manage to survive the week unscathed.

If businesses continue to cut back on spending, delaying the purchase of new equipment, the Business Cycle Dating Committee of the National Bureau of Economic Research may look back at this period and declare it the beginning of a recession.

Beyond the patent lawsuit at

Vonage Holdings


and accounting problem at



, technology companies tend to be sensitive to the mood of the overall economy.



is on the lookout for spillover from the real estate recession. One such result could be that consumers will have to pass on the latest high-tech gadget as their variable rate mortgage payment skyrockets.

For the five trading days ending Thursday, March 29, the worst-performing technology fund was the

Ultra Semiconductors ProShares


. By doubling up its bet on the stocks of the Dow Jones U.S. Semiconductor Index, this exchange-traded fund lost 4.45% of its chips.

The second-worst performer,


ProFunds Semiconductor UltraSector ProFund, (SMPIX) lost 3.18% with its 150% exposure to the same index. The top four holdings make up more than 36% of the index, with



slipping 0.37%,

Texas Instruments


sliding 2.75%,

Applied Materials


off 1.65% and



shedding 3.30% of its value.

Another member of the index,

RF Micro Devices


, steered analysts toward lower estimates of its fiscal first quarter ending in June.

This drove the stock 10.24% lower for the period under review. Also,

Marvell Technology Group


lost 7.25% with the delay of its annual report in conjunction with a six-year restatement of financials due to misdated stock options.

Unlike the two worst performers, the


Fidelity Advisor Electronics Fund (FELTX) managed to lose 3.01% without the use of leverage. The largest hit came from

Jabil Circuit


, whacked for 14.2%.

Rolling disclosures of charges exceeding $54.3 million from stock option compensation, $250 million in restructuring costs and the expected restatements of the 2003, 2004 and 2005 annual reports weigh heavily on the stock.

Those investors bearish on the technology stocks are currently in the right place at the right time with the

UltraShort Semiconductors ProShares


powering its way to a 5.26% total return and the

UltraShort Technology ProShares


manufacturing a 3.54% gain.

Three of the remaining five members of the

B2B Internet HOLDRs Trust

( BHH) fell this week. But since


( CKFR) had a good week and accounts for 68.6% of fund assets, the fund holds third place on our best-performing list.

The upside of moderate weakness in technology companies is the pressure put on the Federal Reserve not to raise interest rates. On Tuesday, the March reading of consumer confidence came in at 107.2, down from 111.2 in February. Without sustained confidence to spend hard-earned dollars, look for continued weakness in tech sector funds.

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.