NEW YORK (CNNfn) - A profit warnings from just one blue chip was enough to spoil the party for the Dow industrials Thursday. Investors rushed to sell members of the stock market's elite index after chemical giant DuPont said earnings in the latest quarter will disappoint.
But big-name technology stocks charged ahead, leading the Nasdaq to a record close, despite a cooling-off among Internet shares even after bellwether Yahoo! reported surprisingly strong second-quarter earnings.
The Dow Jones industrial average tumbled 85.19 points to 9,089.78. Declines outnumbered advances 1,674 to 1,227, as trading volume on the New York Stock Exchange hit 662 million shares.
Peter Cardillo, stock analyst at Westfalia Investments, said the impact on earnings from the still brewing Asian economic crisis is on corporate earnings is just starting to be felt and will be worse in the quarters to come. (290K WAV) or (290K AIFF)
The Nasdaq Composite, which includes many Internet-related stocks, rose 4.43 to 1,939.82, closing at a record for the second day in a row. The broad S&P 500 index slipped 7.81 to 1,158.56. (Look here for the performance of widely held stocks.)
The bond market finished higher, once again supported by strength in the dollar. The benchmark 30-year Treasury bond gained 9/32 of a point in price for a yield of 5.60 percent.
The dollar posted gains against the Japanese yen and the German mark as investors continued to keep a wary eye on Tokyo's and Moscow's simmering financial troubles.
The Internet -- the way of the future?
In stocks, highly speculative Internet shares attracted volumes of buying in the morning after search engine leader Yahoo! (YHOO) surprised Wall Street Wednesday with much better-than-expected second-quarter earnings and announced a 2-for-1 stock split.
Yahoo!'s shares traded sharply higher for most of the day before slumping near the end of the session and closing 2-3/16 lower at 184. Amidst all the hype over the stock, Hambrecht & Quist downgraded Yahoo! to "hold" from "buy."
Other Internet stocks initially followed suit on the upside, but later cooled off. Among Yahoo! competitors, Excite (XCIT) fell 9-1/8 to 82-1/4, Infoseek (SEEK) slipped 2-1/16 to 32-7/16 and Lycos (LCOS) tumbled 6-9/16 to 70-15/16. Netscape (NSCP), originally a browser maker and currently also a Web portal, fell 3/8 to 36-11/16.
Online book retailer Amazon.com (AMZN) shed 1-5/8 to 105-1/2. On the Big Board, America Online (AOL), the world's premiere online service provider, climbed 2-7/8 to 113-5/8. Gateway (GTW), a build-to-order computer manufacturer and lately also an Internet service provider, rose 2-1/8 to 61-7/8.
The heat in Internet stocks, however, did little to warm up the Dow industrials after a blue chip club member warned of sharply lower earnings. Chemical giant and Dow component DuPont (DD) slumped 7 to 70-1/8 after the company said soft energy prices and a prolonged strike at General Motors (GM) would result in second-quarter earnings 10 to 15 percent below the 99 cents a share the company earned a year earlier.
And shares of retailer J.C. Penney (JCP) tumbled 5-13/16 to 65-5/8 after the company predicted lower-than-expected second-quarter earnings.
Also among the day's losers, Advanced Micro Devices (AMD) shed 2-1/4, or more than 12 percent, to 15-7/8 after reporting sharply lower-than-expected results late Wednesday. AMD blamed slow worldwide demand for computer chips and price slashing by industry leader Intel (INTC) for its woes. Intel's shares rose 1-7/16 to 79-3/4.
But other major technology issues posted gains, with Microsoft (MSFT) closing 1-1/8 higher at 111, Dell (DELL) rising 3-1/2 to 99-7/8 and Dow component IBM (IBM) climbing 2-1/16 to 117-1/16.
(Click here for a look at today's hot stocks.) 
-- by staff writer Malina Poshtova Zang
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