Nasdaq's worst year ended on a day that felt very familiar for the year -- led into the red by tech stocks dropping on bad news and warnings over earnings.
All the tech indices were down, led by the
Philadelphia Stock Exchange Semiconductor Index
, which dropped 4.41%. The SOX has dropped more than 51% since hitting its high March 14.
Leading the drop were programmable logic chipmakers
, which have seen gains recently. Altera, which dropped 10.4% today, is up 18.8% since Dec. 20. Xilinx, which fell 5.02%, had been up 16.8% during the same period.
Internet infrastructure player
also lowered its guidance for the December quarter yesterday, saying it would be down more than 34% from the previous quarter and far below estimates.
Dain Rauscher Wessels
lowered its rating to neutral from buy aggressive. F5 said it would start restructuring, including layoffs, next week. Today, F5 was down $1.63, or 14.6%, to $9.50.
The downgrade follows reduced ratings for Internet infrastructure companies
. CacheFlow ended the day down 19%, and Inktomi was down 10.9%.
F5's warning comes a little more than a week after that of
, which announced Dec. 19 that its fourth quarter would be coming up short. Foundry, which lost 51.1% since its announcement, was slightly up today, finishing up 3 cents, or 0.2%, to $15.
, the mother of all networking companies, finished its second day in a row down, off 3.3% today. Cisco had climbed 11.6% since hitting a yearly low Dec. 20. Still, it's far off its high of $82.50.
News reports yesterday said that
, a Massachusetts-based DSL provider, filed for bankruptcy Wednesday, leaving Cisco as its largest unsecured creditor with $70 million. It was unknown whether Broadband could pay Cisco. This was just the kind of debt that caused Cisco to triple its contingency fund for the coming quarter, a fact that came out in a
Securities and Exchange Commission
filing 10 days ago. The revelation that Cisco had increased the fund signaled a warning to investors about its customers, and investors brought the stock down.
warned last night that its fourth-quarter results would widely miss estimates. The company said a drop-off in spending from companies owned by the
Internet Capital Group
, its largest shareholder, drove the revenue shortfall.
Breakaway said it would reduce its staff by another 30%, which follows a 10% cut announced in September. In a note today announcing revised estimates for Breakaway,
Morgan Stanley Dean Witter
analyst Michael Sherrick said the company would need to find cash somewhere by the middle of next year.
Breakaway was down 13 cents, or 12.5%, to 88 cents, having fallen from a high of $74.75 in March.
2:42 p.m.: Net Stocks Still Drifting Down
What a long, strange year it's been. No one's got better reason to wish it gone than former Internet
. They started off the year with a bang of Super Bowl ads and are ending it with a whimper.
TheStreet.com Internet Index
is off 74.5% for the year and is looking to go lower by the end of the day, since there is little reason for tech stocks to move either way.
"It's drifting today," said Scott Kaplan, a partner at
. "There's a lack of buying. No one is around and looking."
While the market is wandering as aimlessly as a lost dog, Internet-connected stocks continue to sink under the combined weight of shrinking information technology budgets and the protracted crack-up of the dot-com world.
analyst Lauren Cooks Levitan released a research note today that said online shopping has reached mass-market status with a broader base of consumers.
Five weeks ago, the worry was whether leading Internet e-tailer
would make $1 billion in revenue for the quarter. Since the day after Thanksgiving, Amazon shares have lost 40%. Now, analysts' consensus seems to be that Amazon has made that number.
Now the question is whether Amazon can translate its position as the
most-visited retail site of the season into solid, moneymaking performance in future quarters.
analyst Kevin Silverman wrote today that the premier e-tailer beat his order estimates for the season, even backing out those from partner ToysRUs.com. What Amazon needs to become profitable is an increase in its numbers and margin dollars.
Amazon, which closed the last trading day of 1999 at $89.37, was down $1.72 in recent trading, or 9.9%, to $15.66.
, which closed 1999 at $237.50, is down $1, or 3.2%, to $30.
, which closed 1999 at $62.59, is down $3.75, or 9.9%, to $34.06.
, which closed 1999 at $47.37, is down 3 cents, or 2.4%, to $1.28.
And it's not just the B2C sites that continue to hurt.
today reduced ratings on Internet infrastructure companies
, based on declining macroeconomics and continuing slower spending for Internet and information services.
In recent trading Inktomi was down $2.03, or 10.1%, to $18.03. Inktomi has lost more than 77% since closing at the end of last year at $88.75.
CacheFlow, which closed the last day of last year at $130.68, was down $3.81, or 18.1%, to $17.25.
Few stocks have fallen as much as fellow infrastructure play
. Akamai, recently down by 12.6%, to $20.88, has lost more than 92.7% this year since closing Dec. 31, 1999, at $327.62.