Tech sector results inject doubts
NEW YORK – A bad day for technology stocks Friday slowed a recent surge in the stock market.
Microsoft led the slump in tech, falling the most in more than four years after the company wrote off nearly $1 billion on its new tablet computer and reported declining revenue for its Windows operating system. Google dropped after its revenue fell below analysts’ forecasts, partly because the Internet search leader’s ad prices took an unexpected turn lower.
With tech stocks falling, the Standard & Poor’s 500 index eked out a gain of 2.72 points, or 0.2 percent, to an all-time high of 1,692.09. The S&P 500 has rebounded after a decline last month and is up 5.3 percent in July.
Despite the market’s broad advance, a growing list of poor tech results is raising concerns about the strength of the economy and the stock market. Intel and eBay also reported weak results this week, and chipmaker Advanced Micro reported a second-quarter loss because of a worldwide slump in PC demand.
Technology “has definitely been a sector that people have been expecting big things from and it has not delivered,” said Randy Frederick, managing director of Active Trading & Derivatives at the Schwab Center for Financial Research.
The Dow Jones industrial average closed down 4.80 points, or 0.03 percent, to 15,543.74. If not for the declines in Microsoft, Hewlett-Packard and IBM, the index would have gained about 70 points.
The technology-heavy Nasdaq composite fell 23.66 points, or 0.7 percent, to 3,587.61. The index was the only major market benchmark to end the week lower, falling 0.4 percent.
Microsoft dropped $4.04, or 11.4 percent, to $31.40 after reporting its earnings late Thursday. That’s the biggest one-day decline since the stock slumped 11.7 percent in January 2009. Google fell $14.08, or 1.5 percent, $896.60. It also posted earnings late Thursday.
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