By Benjamin Pimentel, MarketWatch
SAN FRANCISCO (MarketWatch) -- Shares of Nvidia retreated Friday
after the chip company posted a weaker-than-expected forecast, but
the tech sector got a boost from gains in shares of Twitter Inc and
Yelp Inc.
Nvidia (NVDA) shed 3% after the company reported a downbeat
outlook, although some analysts cited the company's gains in the
graphics chip market.
RBC Capital analyst Doug Freedman said Nvidia posted
"better-than-feared results" as Nvidia's high-end graphics chips
"appear to be grabbing a large share of the PC pie."
But with the PC market contracting, Nvidia is under pressure to
demonstrate in other arenas.
"Longer term, we think Nvidia's challenge will be to generate
enough incremental profits from new initiatives in the data center,
mobile and embedded to replace the Intel-related royalty, which we
expect to end in early 2017, as well as any decline in PC-related
revenue," Susquehanna analyst Chris Caso told clients in a
note.
Apple Inc. (AAPL) also slipped nearly 1% to $583.20 on reports
that the company was in talks to buy Dr. Dre's Beats for $3.2
billion.
The sector got a lift from shares of Twitter (TWTR) , which
rallied more than 2%. Yelp Inc. (YELP) also was up 2%. Both
companies got upbeat reviews from Morgan Stanley on Thursday.
Twitter was poised to end the week down more than 15% after a
huge wave of unlocked shares hit the market.
The Nasdaq Composite Index (RIXF) was mostly flat, last trading
down 0.2% to 4,044. The benchmark was on track to the end the week
down more than 1%.
The Morgan Stanley High Tech 35 Index (MSH) was up a fraction,
while the Philadelphia Semiconductor Index (SOX) was down 0.6%.
Other stories from MarketWatch:
Apple in talks to buy Dr. Dre's Beats for $3.2 billion
Amazon expands service to more than 15 cities
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