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Bear Stearns Cuts Rating on EMC, Sun Microsystems

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Bear Stearns

lowered its investment ratings on computer hardware and software equipment suppliers

EMC

(EMC)

and

Sun Microsystems

(SUNW) - Get Sunworks, Inc. Report

to attractive from buy.

In his research note, analyst Andy Neff said that while both EMC and Sun "are leaders," he expects a slowdown in corporate IT spending to "impact both companies' financial performance," adding that "gravity is bound to take over."

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Neff said that he sees signs of weak consumer demand in the PC market, which has "continued to deteriorate," and indicated that the sluggishness was spreading into small- and medium-sized corporate customers. Neff downgraded PC stocks in September, citing concerns about weak demand.

After Thursday's bell,

Microsoft

(MSFT) - Get Microsoft Corporation Report

dropped a

bomb, warning that weakening PC sales, corporate IT spending and online advertising would lower its second-quarter earnings and revenue.

Shares of EMC recently fell $4.63, or 6.2%, to $70 on the Big Board. Sun lost $1.31, or 4.1%, to $30.38 in

Nasdaq

trading.