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Weak Tech Results Dismay Wall Street AROUND THE MARKETS STOCKS: NEW YORK

Posted on: Sunday, 5 February 2006, 12:00 CST

Falling consumer confidence widened a decline among stocks on Friday after downbeat earnings reports from Amazon and Maytag.

Technology shares slid, pulled down by the $4.41 drop in Amazon shares after the online retailer's 43 percent drop in quarterly earnings, reported late Thursday, disappointed Wall Street. The decline came despite higher sales as the company continued to invest heavily in technology and marketing. Amazon shares closed at $38.33

In addition, shares of Gateway, a leading maker of personal computers, dropped 37 cents to $2.41 after its fourth-quarter profit missed analysts' estimates because of parts shortages. Gateway's chief executive, Wayne Inouye, said shortages of Intel chipsets had prevented the company from making enough PCs. Intel fell 46 cents to $20.74

Google also declined, falling $14.38 to $381.66

"The sentiment is tired in terms of the Internet universe," said Martin Pyykkonen of Hoefer & Arnett in Denver. The Dow Jones industrial average fell 58.36 points to finish at 10,793.62. The Standard & Poor's 500 index dropped 6.81 points to 1264.03. The Nasdaq composite index dropped 18.99 points to 2,262.58. "I'm a little bit less bullish than I was maybe a month ago," said Darin Richards, chief investment officer at Wealth Advisors in Lake Oswego, Oregon, citing "the earnings misses probably more than anything else." The home appliance manufacturer Maytag posted a wider fourth-quarter deficit after soaring costs from restructuring charges offset a 7 percent sales growth. Maytag lost 51 cents to $17.51; Whirlpool, which is buying Maytag, rose 25 cents to $86.62

Dow Jones, publisher of The Wall Street Journal, rose 43 cents to $38.70 even though Moody's Investors Service threatened to cuts its debt rating because of deteriorating performance. Honeywell, the world's largest maker of airplane cockpit controls, added 70 cents to $39.23. The stock was raised to "buy" from "hold" by Jeffrey Sprague of Citigroup. European shares gained on strong earnings by Rolls-Royce. The FTSE index rose 12 points to 5,759.30, the CAC 40 gained 9.67 points to 4,937.56, and the DAX rose 7.52 points to 5,657.12.

Source: International Herald Tribune

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