NEW YORK (CNN/Money) -
Technology stocks managed to finish higher on Tuesday as investors shrugged off news that brokerage Lehman Brothers downgraded its ratings on Intel Corp. and National Semiconductor Corp.
The tech-laced Nasdaq Composite index closed 14.08 points, or 0.8 percent, higher at 1,858.56, but the Philadelphia Semiconductor index lost 4.08 points, or 1.1 percent, to close at 353.76.
Lehman Brothers on Tuesday lowered its rating on shares of Intel following the top computer chipmaker's disappointing business update last week, and it lowered its rating on the semiconductor sector as a group.
In a note to clients, Lehman said it was reducing its rating on Intel to "equal weight" from "overweight." It cut its view on the sector to "negative" from "neutral."
Intel (INTC: Research, Estimates) shares closed at $19.89 on Nasdaq, after hitting a 15-month low of $19.73 during intraday trade.
Lehman also downgraded National Semi (NSM: down $0.75 to $12.42, Research, Estimates) to "equal weight" from "overweight."
Among other tech heavyweights, Microsoft Corp. (MSFT: up $0.25 to $27.36, Research, Estimates) stock gained nearly 1 percent, while Cisco Systems (CSCO: up $0.30 to $19.05, Research, Estimates) rose 1.6 percent.
CIBC World Markets upgraded Cisco to "sector outperformer" from "sector performer," saying it expected the top networking equipment maker to post faster-than-expected market growth.
Oracle Corp. (ORCL: up $0.05 to $10.08, Research, Estimates) and Yahoo! Inc. (YHOO: up $0.18 to $29.64, Research, Estimates) also moved higher.
In other tech-related news, shares of Netflix and TiVo rose sharply higher after a magazine article said the two companies are close to a deal that would allow Netflix subscribers to download movies over the Internet to their TiVo devices.
Newsweek, citing an anonymous source close to the talks, said the deal could be approved by TiVo's board of directors this week. Shares of Tivo and Netflix, both of which recently hit 52-week lows on concerns about their growth prospects, each surged 16 percent.
Shares of TiVo (TIVO: up $0.66 to $5.08, Research, Estimates) jumped 15 percent, while Netflix (NFLX: up $1.05 to $15.41, Research, Estimates) stock rose 7.3 percent, both on Nasdaq.
Seagate Technology stock also moved higher after the company forecast quarterly revenue above Wall Street estimates on strong demand for storage for larger business computers.
Seagate, the top U.S. maker of hard drives used to store data in computers, said sales of enterprise storage products appeared stronger than expected in the fiscal first quarter ending Oct. 1, more than offsetting disappointing demand for desktop computer products.
Shares of Seagate (STX: up $0.45 to $12.32, Research, Estimates) finished 45 cents higher at $12.32 on the New York Stock Exchange after rising as high as $13.25 in early dealings.
Elsewhere, VeriSign (VRSN: Research, Estimates) shares soared after the Internet registration site said it expects third-quarter sales to be above Wall Street estimates.
The company said its recently acquired Jamba business is performing ahead of expectations. As a result, VeriSign forecast third-quarter sales to be above its current guidance of $285 million.
Its stock closed $1.55, or 8.7 percent, higher at $19.40.
-- from staff and wire reports
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