Updated from 2:11 p.m. EST with new stock pricesTech stocks started the year lower as Wall Street grappled with weak economic data in the manufacturing sector and soaring crude oil futures. Online retailer Amazon.com ( AMZN) bucked the trend, rising 3.9% after the stock was upgraded to buy from hold by a Citigroup analyst. Amazon.com's fourth-quarter results could "modestly" top expectations, said the analyst in a note, adding that his firm sees a 10% upside to the Street's 2008 earnings-per-share estimate for the company. Amazon.com gained $3.61 to $96.25. Yahoo! ( YHOO) gained 2% after a ThinkEquity analyst upgraded the stock to buy and put a price target of $32 on the stock. Yahoo! shares are down nearly 22% since Oct. 22 and the stock at its current price offers an "an attractive entry point," said the analyst. Yahoo! was up 46 cents to $23.72. Chip stocks were down after Banc of America analysts wrote in a research note that they are adopting a more cautious stance on the sector. The recovery in the chip sector last year has "run its course," analysts said, and now industry-wide inventories are slightly above equilibrium levels. Intel ( INTC), which was downgraded to neutral from buy, was off $1.31, or 4.9%, to $25.35. AMD ( AMD) fell 36 cents, or 4.8%, to $7.14, touching a new 52-week low.
In addition, Texas Instruments ( TXN) fell $1.05, or 3.1%, to $32.35, and LSI ( LSI) was down 43 cents, or 8.1%, to $4.88. Qualcomm ( QCOM) was down 96 cents, or 2.4%, to $38.39 following a federal court injunction on Monday to
block it from selling mobile phone chips that infringe on rival Broadcom's ( BRCM) patents. Broadcom rose 18 cents, or 0.7%, to $26.32. IBM fell 3.2% after the company confirmed that it has acquired Israeli data storage startup XIV Information Systems. Terms of the deal were not disclosed, but earlier media reports priced the purchase between $300 million and $350 million. IBM fell $3.41 to $104.69. Video-games publisher Activision ( ATVI) started the New Year on a sour note. The company's stock fell $1.27, or 4.3%, to $28.43. Apple ( AAPL) continued its retreat after nearing the $200 mark on Dec. 26. The stock was down $3.24, or 1.6%, to $194.84.