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CNNfn tech stock report
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September 3, 1998: 5:13 p.m. ET
Nasdaq has few bright spots as tech-heavy index loses almost 21
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NEW YORK (CNNfn) - Bad signals from markets around the world and fears of a global economic slowdown took its toll on technology stocks Thursday.
The Nasdaq Composite never saw positive territory Thursday. The tech-heavy index finished down 20.98 to 1,571.87 on volume of almost 784 million shares. Declines outpaced advancers by a 4-to-3 margin.
Internet stocks played a big part in Thursday's drop as all of the big-name players turned in losses. Heavy losers included Internet directory Yahoo! Inc. (YHOO) which lost 2-9/16 to 75-3/16. Competitors Excite Inc. (XCIT) lost 2-3/16 to 25-1/2, Infoseek Corp. (SEEK) shed 1-3/4 to close at 17-1/8 and Lycos Inc. (LCOS) dropped 3/4 to end at 25-5/16.
Internet high-flyers also turned in losses, led by online bookseller Amazon.com Inc. (AMZN), which lost 2 to 85-7/8, America Online Inc. (AOL) lost 7/8 to 87-1/8 and Internet service provider MindSpring Enterprises Inc. (MSPG) lost 2-1/8 to end at 30-7/8.
Software giant Microsoft Corp. (MSFT) lost 1-5/16 to close at 99-1/4 after the company lost a court battle to keep key documents out of the hands of federal prosecutors in its upcoming antitrust trial.
One of the few tech gainers Thursday was Intel Corp. (INTC) which added 1-7/8 to end at 76-3/4 after Morgan Stanley Dean Witter analyst Mark Edelstone reiterated his "strong buy" rating.
Another gainer was telecommunications company WorldCom Inc. (WCOM). Shares gained 1-5/8 to 47-3/8 after Lehman Brothers Inc. analyst Blake Bath reiterated his "buy" rating on the stock.
Dell Computer Corp. (DELL) lost 2-3/16 to 108-1/16 despite the fact that PaineWebber initiated coverage of the stock with an "attractive" rating.
PaineWebber also initiated coverage of IBM Corp. (IBM) with a "buy" rating. IBM shares gained 1-1/14 to close at 121-3/4.
Several companies issued earnings warnings Thursday, including magazine publisher CMP Media Inc. (CMPX) which plunged 4-7/8 to 10-5/8. The company warned third-quarter earnings would likely only be 1 to 2 cents a share, instead of the 21 cents analysts had been expected. CMP blamed the warning on a decrease in income at its magazine properties.
Icos Vision Systems Corp. (IVISF) fell 7/8 to 13-3/4 after the maker of semiconductor inspection products warned revenue and income would fall for the rest of 1998 because of a slowdown in orders.
Etec Systems Inc. (ETEC) fell 1-5/8 to 27-3/8 after the chip equipment maker said it remains cautious about short-term prospects in the industry.
Chip maker VLSI Technology Inc. (VLSI) lost 1 to 7-13/16 after the company warned third-quarter sales would be lower than original estimates. The company also expects to take a third-quarter charge to cover previously-announced layoffs.
Shares of telecom equipment company Ciena Corp. (CIEN) fell 2-9/32 to 26-3/16 a day after the company said its shareholders won't be able to vote on the Tellabs Inc. (TLAB) takeover until mid-November.
One of the day's deals came from DST Systems Inc. (DST) which announced its buy of USCS International Inc. (USCS) for $874 million. DST handles data processing for the mutual fund industry while USCS provides software and services to communications and services companies. DST shares lost 8-5/8 to 51-7/8 while USCS gained 4-3/8 to 30-3/8.
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