As it turns out, the glass half-empty approach toward tech stocks was the right one to take today. What news came out after the close of market wasn't good news for PC and chip stocks.

With two days of warnings, investors assumed that the news from PC maker

Gateway

(GTW)

wasn't going to be especially good. The PC manufacturer closed down $1.50, or 4.84%, to $29.50, dragging down fellow PC makers

Apple

(AAPL) - Get Report

, which closed down 47 cents, or 2.6%, to $17.56;

Compaq

(CPQ)

, which closed down 40 cents, or 1.7%, to $22.70; and

Dell

(DELL) - Get Report

, which closed down 63 cents, or 2.8%, at $21.81.

Then came Gateway's

announcement that much weaker-than-expected shopping for PCs would cause it to miss revenue estimates of $3.05 billion, for the quarter ending Dec. 31, by $500 million, making revenue flat to last year.

We always think we've seen the last shoe in this earnings season, but we never have," said analyst Daniel Kunstler of

J.P. Morgan Securities

.

Early warning from

Salomon Smith Barney

about possible inventory stockpiles hit the computer makers yesterday. And this morning,

Merrill Lynch

analyst Steve Fortuna wrote that he expected Gateway to announce disappointing sales. But Fortuna left his earnings-per-share estimate of 63 cents intact. Gateway estimated earnings at 37 cents a share.

Investors assumed the worst for highflier

Brocade

(BRCD)

and fellow members of the storage industry. Brocade, which makes fiber switches for network-storage companies, announced that its earnings of 22 cents a share would top estimates of 20 cents by

First Call/Thomson Financial

. Brocade also announced a stock split. Nervous investors, though, brought the stock down $7.25, or 4.5%, to $153.75.

Storage-industry leader

EMC

(EMC)

was down $6.31, or 7.9%, to $73.19, and its competitor

Network Appliance

(NTAP) - Get Report

closed down $2.19, or 4.2%, to $50.

EMC is bringing out a new storage product that has caused some jitters for competitor Network Appliance, although its impact should have been priced into the stock by now. Investors seem to be targeting valuation.

"People are turning against the names with the high multiples. Storage is one of the last groups holding up," said analyst Kevin Hunt of

Thomas Weisel Partners

.

But investors did not anticipate the bad news with chipmaker

Altera

(ALTR) - Get Report

. The maker of programmable logic devices warned after market close that it would have flat sequential earnings because customers stockpiled inventory. But it closed up 3 cents, or 0.1%, to $25.94.

Fellow PLD maker

Xilinx

(XLNX) - Get Report

, which trades similarly, closed down $2.91, or 6.3%, to $43.

3:04 p.m.: Tech Cheer Turns to Gloom

Like someone who wakes up happy and finds the day gone horribly wrong, technology stocks started out the day on a modestly positive note, only to find themselves tripping into a funk over pieces of bad news.

Semiconductor stocks were wandering, looking for some reason to get cheerful and finding none. The

Philadelphia Stock Exchange Semiconductor Index

recently was down 1.8%.

"We're looking for positive data points and haven't found any, unfortunately," said one analyst, who asked not to be named.

ChipPAC

(CHPC)

was down $4.68, or 63.6%, to $2.69 after a downgrade by

Merrill Lynch

. ChipPAC announced Wednesday that fourth-quarter revenue would be 22% below its previous estimates, due to weak orders from wireless phone and PC customers.

Similar concerns about reduced demand led to a downgrade of

Amkor Technology

(AMKR) - Get Report

-- like ChipPAC,a semiconductor packager and tester.

Deutsche Banc Alex. Brown

analyst Erika Klauer reduced her rating from strong buy to buy on worries of lower orders from wireless and PC makers.

Some of the bad karma may have spilled onto chip makers

Texas Instruments

(TXN) - Get Report

and

National Semiconductor

(NSM)

, both of which make chips for consumer applications. Texas Instruments was trading down $1.50 or 3.7% to $39 after

Credit Suisse First Boston

analyst Charlie Glavin wrote that weakness in wireless orders may mean slower-than-expected growth for the first quarter of 2001. National was sliding less steeply, trading down recently 13 cents, or 0.6%, to $19.56.

One pocket of green came from the communications chipmakers, led by

Broadcom

(BRCM)

.

Morgan Stanley Dean Witter

analyst Mark Edelstone raised the stock to a strong buy from outperform, noting it was attractively valued. Broadcom was trading up $5.44, or 6.4%, to $90.50.

Merrill Lynch analyst Joe Osha said checks on communication chips indicate no weakness in orders or revenue for the December quarter. The first sign of trouble for the communications-chip makers wouldn't show until March of the coming year, he wrote.

Fellow communications chipmaker

PMC-Sierra

(PMCS)

was also trading higher recently $4.39, or 4.5%, to $101.25. Glavin wrote that PMC's management yesterday repeated its guidance that the company would have sequential growth of 15% for the fourth quarter and denied rumors of "massive" order cancellations.

The news blew hot and cold down

TheStreet.com Internet Index

, which was down 2.4%.

Bear Stearns

analyst Robert Fagin reiterated a buy rating on

Inktomi

(INKT)

, saying the shares have been unfairly hurt by the perception that the telecom slowdown would affect its business. Inktomi, whose shares have dropped 69.4% since Oct. 24, was trading higher, up $1.19 or 4.9% to $25.44.

And a day after

Salomon Smith Barney's

note advising caution on PC stocks, came a revision on earnings estimates for PC seller

Gateway

(GTW)

from Merrill's Steve Fortuna. Fortuna said the company probably will make remarks today or tomorrow about the quarter. Fortuna said he believed that Thanksgiving weekend PC sales, while better than pre-holiday weeks, "were not quite as strong as originally hoped for." Gateway was trading down $2.70, or 8.7%, to $28.30.