This summer's tech selloff is squeezing the networking stocks, and Wall Street sees only more pressure ahead.

The steady slide in communications-equipment stocks that started last month steepened this week in the wake of

Cisco's

(CSCO) - Get Report

newfound caution. On Thursday, a day after Cisco's woes led to a slew of downgrades, the sector was pummeled by more dreary predictions.

Corning

(GLW) - Get Report

shares led the way down Thursday, falling 10% after UBS analyst Nikos Theodosopoulos downgraded the stock. He cited an upcoming slowdown in the glass-panel industry that only recently appeared to be one of tech's most robust growth areas.

The Corning slide came two days after Friedman Billings Ramsey spend-trend watcher Susan Kalla said the recent uptick in telecom-network investments was merely a head fake. Kalla says that after phone companies finish a round of maintenance and capacity-expansion work, capital spending will resume its slowing course as buyers move away from traditional telecom gear.

"It's really looking like Death Valley out there," says Kalla.

Cisco shares closed in on a 52-week low Thursday, dropping 3% to $17.68. Meanwhile, outfits like

Lucent

(LU)

,

Ciena

(CIEN) - Get Report

and

Ericsson

(ERICY)

each fell 5% or more. One of the only names not in the red Wednesday was wireless standard-bearer

Qualcomm

(QCOM) - Get Report

.

It's not a big surprise that Qualcomm has mostly sidestepped the

tech wreck, because demand for handsets remains healthy as wireless telcos add subscribers. But investors probably weren't prepared to hear the slowdown spread into pockets of growth such as flat-panel glass screens.

Corning executives were banking on glass display screens as the next big growth market that would help them overcome the collapse of the fiber-optic cable business. The company has been boosting production capacity to fill projected demand levels for flat-panel devices such as LCD computer monitors and TV screens. But presumed demand and growth rates are now in question.

In a research note Thusday, UBS analyst Theodosopoulos says recent checks indicate a slowdown in retail sales likely will cause producers to cut back production. "We believe Corning's glass shipment could hit a speed bump in August after a solid July, making it tougher to hit its 10% growth guidance," writes Theodosopoulos.

Similarly, solid sales at Lucent and a couple of blowout quarters at

Juniper

(JNPR) - Get Report

raised expectations that spending on networking gear was starting to rebound after four lean years of budget cuts. But FBR's Kalla says the industry is hitting a pause as it makes a critical tech transition.

In her report, Kalla says U.S. telcos and cable companies will curtail their investments in conventional copper networking gear as they review plans for other technology, including fiber optics and Internet protocol.

Kalla predicts U.S. equipment spending will drop 9% to $53 billion this year and fall an added 5% next year.

These aren't uplifting predictions when Wall Street's in the throes of a summer selling spree.