Midday Report: Techs Push Nasdaq Higher, but Still Short of 2,000

Stocks on the Nasdaq Composite Index were putting the brakes on a three-day slide at midday Tuesday, as buyers stepped in to purchase beaten-down technology issues.

At midday, the Nasdaq Composite Index was up 33.39 at 1,956.77. Cisco (Nasdaq: CSCO), Oracle (Nasdaq: ORCL) and Sun Microsystems (Nasdaq: SUNW) paced the advance.

On Monday, the Nasdaq closed below 2,000 for the first time in more than two years, after networking giant Cisco said it would lay off workers, and other technology companies — including cell phone maker Ericsson — warned of weak quarterly results.

The broader Standard & Poor’s 500 stock index, meanwhile, was down 3.64 at 1,176.52. Blue-chip issues also remained lower, with the Dow Jones Industrial Average sliding 56.03 to 10,152.22 at midday.

Cisco Rallies

Cisco, up US$1.05 at $19.86 at midday, has been especially hard hit in recent weeks amid concern about future earnings.

Chief executive officer John Chambers reportedly told investors at a technology conference Tuesday that orders remain weak, and business is slowing in Europe and Asia.

The E-Commerce Times Index was up 2.27 percent at midday, with every issue registering a gain or trading unchanged.

More Caution Flags

The barrage of earnings warnings from technology companies continued, with Molex (Nasdaq: MOLX), Cabot Microelectronics (Nasdaq: CCMP) and Standard Microdevices (Nasdaq: SMDI) all dropping after issuing statements that quarterly results would be below previous expectations.

Motorola (NYSE: MOT) was down 15 cents at $14.85 after announcing plans to cut about 7,000 jobs in an effort to reduce costs in its wireless handset business.

The cuts bring the total number of layoffs in the Schaumburg, Illinois, company’s personal communications division since December to 12,000. The job cuts will be made over the next two quarters, and will be reflected in charges against first- and second-quarter earnings, Motorola said.

Nokia Plants Plucked

Rival cell-phone maker Nokia (NYSE: NOK) was up 49 cents at $21.94 after saying it would sell two of its plants, in Finland and the UK, to SCI Systems (NYSE: SCI), which manufactures the devices. SCI was up 35 cents at $16.36.

The day’s economic news provided more reason to believe that U.S. Federal Reserve policymakers will push interest rates lower when they meet later this month. The U.S. Department of Commerce said that retail sales fell 0.2 percent in February, after rising 1.3 percent a month earlier.

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