NEW YORK (CNN/Money) - A selloff, particularly in the tech sector, loomed for U.S. stocks Wednesday amid disappointment about Intel's quarterly report.

Early Wednesday , Nasdaq futures were sharply lower. S&P futures also declined, though not as steeply.

Among U.S. stocks trading in Europe, Intel (INTC: Research, Estimates) fell nearly 5 percent. The world's largest chip maker posted higher second-quarter income in line with expectations, but disappointed analysts with sales figures and its gross margin forecast.

Stocks were mixed in advance of the Intel report. The Dow Jones industrial average gained 0.1 percent, but the Nasdaq composite index was down 0.3 percent.

"Intel hit everything in its report but said inventories are rising and profit margins are falling. And that's all she wrote," said Larry Wachtel, market analyst with Wachovia Securities.

"Semiconductor stocks are weak overseas and we should get a soft opening this morning. The magic bullet that everyone was waiting for did not arrive," he said. "Overall, given the lassitude of the market, people are just not committed right now."

Before the start of trading, investors received the latest government report on June retail sales.

Sales last monthfell 1.1 percent, wider than analysts estimates for a 0.7 percent fall, and excluding autos, core sales dipped 0.2 percent, below expectations for a rise of 0.2 percent, according to Briefing.com.

In earnings news, two tech components, Advanced Micro (AMD: Research, Estimates) and Apple Computer (AAPL: Research, Estimates) are scheduled to report quarterly results after the close.

Wall Street analysts expect Advanced Micro to report a profit of 9 cents a share, compared with a loss of 40 cents a share a year earlier, according to First Call. Apple Computer is expected to have grown profit to 15 cents a share from 5 cents a share in the prior-year period.

Asian-Pacific stocks reacted sourly to the Intel report, with Tokyo's Nikkei index down 2.3 percent. European markets retreated in morning trading. (Check the latest on world markets)

Treasury prices fell, sending the 10-year note yield up to 4.48 percent from 4.46 percent late Tuesday. The dollar gained against the yen, but was lower versus the euro. Gold rose.

As new violence erupted in Iraq, U.S. crude futures rose 10 cents to $39.54 a barrel in electronic trading, while Brent oil futures added 13 cents to $36.82 a barrel in London.