NEW YORK (CNNfn) - Among tech stocks, the chip segment staged the strongest comeback -- led by communications chip suppliers and semiconductor equipment makers -- while computer hardware makers also turned positive after a sharp dip earlier in the day.
In general, technology stocks took a turn for the better Monday afternoon, moving higher after a midday drubbing that pulled most of the major tech indexes deep into negative territory.
Meanwhile, the tech-rich Nasdaq composite index spiked sharply in a flurry of late afternoon buying, but ended the session at 4,577.82, 12.68 points below its opening level.
At the same time, blue chips rose sharply after last week's sell-off.
"What you are seeing now is the buying of individual companies in the Dow for value," said Richard Babson of Babson-United Investment Advisors. "It is less a question of tech versus financial stocks, and more a question of looking at specific companies."
RF Micro soars on Qualcomm deal; Conexant dives on downgrade
Chip makers were the tech sector's biggest bouncers Monday, and RF Micro Devices (RFMD: Research, Estimates) was among that industry's biggest movers.
Shares of RF Micro, which specializes in radio frequency chips for wireless communications devices, soared 23-15/16, or 20.8 percent, to 138-15/16. The company on Monday announced that it would work with Qualcomm (QCOM: Research, Estimates) to develop chips for use with Qualcomm's proprietary wireless communications technology.
National Semiconductor (NSM: Research, Estimates) shares also rose sharply on the day, ended the session up 5-3/8, or 7.9 percent, at 73-3/8.
Companies that make the equipment used in semiconductor manufacturing also headed higher Monday. Novellus (NVLS: Research, Estimates) added 2-3/8, ending the session 4.5 percent higher at 55-1/2. Applied Material (AMAT: Research, Estimates) shares rose 4-9/16, or 2.7 percent, to 176-7/8. Semitool shares advanced 1-7/8, finishing the day 4.8 percent higher at 40-5/8.
Leading the downside in the chip industry Monday was Conexant (CNXT: Research, Estimates), which headed sharply lower, ending the session down 18-13/16 at 96-13/16, a 16.3 percent decline on the day. SG Cowen on Monday downgraded its rating on Conexant, which also makes communications chips, to "buy" from "strong buy," citing valuation concerns.
"The price-earnings ratio is no longer compelling at these levels, and there are other stocks in the group one would want ahead of Conexant," SG Cowen analyst Rick Billy said in a research note.
Billy said that the near-term outlook for the company was "still good," and left his estimate for fiscal 2000 earnings of 86 cents per share intact. He cut fiscal 2001 estimates to $1.03 per share from $1.08 per share.
Separately, Conexant on Monday unveiled the "SmartSCM," which it says is the industry's first single-chip modem allowing Internet connectivity from devices such as game consoles and handheld computers.
 Other chip companies taking it on the chin included: PMC-Sierra (PMCS: Research, Estimates), down 6-7/8, or 3.7 percent, at 178-3/4; Triquint Semiconductor (TQNT: Research, Estimates), off 6-29/32, or 5.9 percent, at 111-3/16; and Broadcom (BRCM: Research, Estimates) down 9-1/2 at 181-1/2, a 5 percent decline on the day.
Shares of Intersil (ISIL: Research, Estimates), which made its Nasdaq debut Friday, also ended Monday's session lower, finishing down 6-1/4 at 47-3/4, an 11.6 percent decline on the day.
The Philadelphia Stock Exchange's semiconductor index, or Soxx, capped off the session on a sharp upswing, closing 34.41, or 3.3 percent, higher at 1,066.43.
Hardware makers tread water at close
Computer equipment makers also ended mostly in positive territory Monday after dropping sharply earlier in the day. The Goldman Sachs computer hardware index finished the session up a fraction of a point at 545.9 after falling to an intra-day low of 530.63 at around noon.
Helwett-Packard (HWP: Research, Estimates) led the way higher among PC makers, rising 4-3/16 to 128-13/16, a 3.4 percent rise on the day. Apple Computer (AAPL: Research, Estimates) advanced 2-7/8, or 2.6 percent, to 113-1/4. Gateway (GTW: Research, Estimates) edged up 1/16 to 69-1/2.
PC makers heading lower Monday included: Dell (DELL: Research, Estimates), down ¼ at 41; Compaq (CPQ: Research, Estimates), which slipped ½ to 25-1/2, a 1.9 percent decline; IBM (IBM: Research, Estimates), which slid 3-9/16, or 3.3 percent, to 104-7/16; and Micron Electronics (,UEI: Research, Estimates), down ¼, or 2.2 percent, at 11-5/16.
Computer networking-equipment giant Cisco Systems (CSCO: Research, Estimates) ended the session 2-3/16 lower at 130-9/16, a 1.7 percent decline on the day. Cisco competitor Lucent Technologies (LU: Research, Estimates) fell 1-3/8, or 2.3 percent, to 57-7/8. Nortel Networks (NT: Research, Estimates) shares edged down ½ to 113.
Dot.coms dragged down
Shares of Internet stocks failed to recapture their losses Monday, ending the session mostly lower.
Among the day's losers was e-commerce bellwether Amazon.com (AMZN: Research, Estimates), which fell 3-3/8, or 4.9 percent, to 65-3/4. The company on Monday launched a new Web site aimed at shoppers using Internet-enabled wireless phones.
Web auctioneer eBay (EBAY: Research, Estimates) dipped 5-3/4, or 3.8 percent, to 145-1/16 after the company denied reports published by the British newspaper The Independent that the online auctioneer was set to offer $1.6 billion to buy troubled auction house Sotheby's. Also on Monday, eBay announced the launch of its Japanese site, with over 800 auction categories, including local favorites such as Pokemon and Hello Kitty.
Yahoo! (YHOO: Research, Estimates) fell 3-1/4 to 161-15/16, a 2 percent decline on the day amid reports of a possible joint venture with News Corp. Ltd.
America Online (AOL: Research, Estimates) fared better, adding 15/16, or 1.6 percent, to 60-9/16 after it announced six separate deals with wireless companies to provide its Web services on mobile units.
 Companies shaking hands with AOL on Monday included: Nokia (NOK: Research, Estimates), which fell 1-3/4 to 203-1/8; Sprint PCS (PCS: Research, Estimates), up 1-1/16 at 49-1/8; Motorola (MOT: Research, Estimates), off ¾ at 158-1/2; Canada's Research in Motion Ltd. (RIMM: Research, Estimates), up 8-13/16 at 147-3/4; BellSouth Corp. (BLS: Research, Estimates), up 1-7/8 at 38-7/8; and paging services provider Arch Communications Inc. (APGR: Research, Estimates), soaring 2-3/8, or 20.4 percent, to 14.
The Dow Jones composite Internet index ended the session 9.04 lower at 414.79, a 2.1 percent decline on the day. 
--Compiled from staff and wire reports
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