Estimated read time: 2-3 minutes
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
By MICHAEL J. MARTINEZ
AP Business Writer
NEW YORK (AP) -- Disappointing tech sector earnings set off a second day of selling on Wall Street Wednesday as investors also worried about a massive tumble in Japan's market and rising oil prices.
Earnings from Intel and Yahoo raised investors' anxiety about other companies' results during the first big week of quarterly reports. Meanwhile, oil prices extended their climb past $66 a barrel.
Tokyo's stock markets closed early due to heavy trading volume, an unprecedented move, as the Nikkei 225 lost 2.94 percent for the session. The selloff moved to Europe, where the major indexes also dropped significantly.
In the first hour of trading, the tech-focused Nasdaq composite index fell 35.46, or 1.54 percent, to 2,267.23.
The other major stock indicators also fell, but by smaller percentages. The Dow Jones industrial average dropped 39.70, or 0.36 percent, to 10,856.62, and the Standard & Poor's 500 index lost 5.90, or 0.46 percent, to 1,277.03.
Bonds rose as stocks fell, with the yield on the 10-year Treasury note falling to 4.31 percent from 4.33 percent late Tuesday. The dollar fell against most major currencies, while gold prices also dropped.
Fears over escalating tensions in the Middle East were blamed for the rise in oil, which came despite unusually warm weather and low heating oil demand in the Northeast. A barrel of light crude was quoted at $66.50, up 19 cents, in premarket trading on the New York Mercantile Exchange.
The state of affairs in international markets overshadowed good news on domestic inflation from the Labor Department. The consumer price index, which measures the price of retail goods and services, fell 0.1 percent, better than the 0.2 percent rise expected on Wall Street. So-called "core" CPI, with food and fuel prices removed, rose 0.2 percent, in line with economists' forecasts.
In earnings news, Dow component Intel posted a 16 percent jump in fourth-quarter profits, but missed Wall Street's earnings forecasts by 3 cents per share. The chip maker blamed soft computer demand for the shortfall. Intel, considered a barometer for the rest of the tech sector, tumbled fell $2.72, or 11 percent, to $22.80.
Yahoo dropped $4.98, or 12 percent, to $35.13 after it also missed analysts' profit expectations despite doubling its fourth-quarter earnings from a year ago. It was the second consecutive quarter that Yahoo missed Wall Street's forecasts, prompting worries that the Internet company was losing ground to rival Google Inc.
The Russell 2000 index of smaller companies fell 4.87, or 0.69 percent, to 698.75.
Overseas, Britain's FTSE 100 was down 0.57 percent, Germany's DAX index lost 1.13 percent, and France's CAC-40 fell 0.64 percent.
------
On the Net:
New York Stock Exchange: http://www.nyse.com
Nasdaq Stock Market: http://www.nasdaq.com
(Copyright 2006 by The Associated Press. All Rights Reserved.)
