Cisco Systems

(CSCO) - Get Report

lost 3.5% in early trading after

Sanford C. Bernstein

cut the company and

Nortel Networks


to market perform from market outperform. Nortel was down 1.1%. Analyst Paul Sagawa said he expects a "sharp deceleration" in telecom equipment spending.

Merrill Lynch

reiterated its buy on both companies, but the Bernstein downgrade hurt other network and optical stocks.

JDS Uniphase


was down 1.2% and


(GLW) - Get Report

was down 3%.

Bargain-hunters, however, pushed



up 7.6% after a recent slide that knocked its market cap below $100 billion for the first time in almost two years.