The sky is not falling. The
has not raised interest rates. High-tech stocks are just seeing good old-fashioned profit-taking.
Derek Brown, analyst with
Volpe Brown Whelan
, said he didn't see any specific news that triggered the profit-taking, but it could be healthy for a sector that has seen way more ups than downs of late.
"The Internet stocks have seen significant moves over the past six months to a year, with particular notice paid to the last several weeks," said Brown. "It's a very natural selloff considering the run-up they've had."
Brown said it was difficult to say how deep the correction would run because of how far many of the stocks have come and how volatile they can be.
"We've seen 10%, 20%, 40% moves in these stocks in a day, so that's certainly something to be aware of," he said. "But over the long term, this is going to be viewed as a pause in a general uptrend for these stocks."
Not all the declines could be attributed to profit-taking. Shares of
were off 10 11/16, or 33%, at 21 1/8 around midsession after the company said that fourth-quarter earnings would be below expectations, while also lowering its estimates for the first quarter.
was down 15 7/16 at 202 1/2. However, the stock is still up significantly from its 1998 close of 130 7/8.
Other stocks of note include
, down 6 5/8 at 126 3/4;
, down 8 7/8 at 99 3/4; and
, down 5 3/8 at 114 5/8. Both
, which had big run-ups Monday, remained lower. E*Trade was recently down 5 11/16 at 56 3/4, while Ameritrade was down 6 at 99.