By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Tech stocks turned sideways
Tuesday on a day highlighted by reaction to Texas Instruments
Inc.'s deal to buy National Semiconductor Corp. for $6.5 billion
and a rebalancing of the Nasdaq 100 Index that trimmed the
influence of Apple on the market gauge.
The Philadelphia Semiconductor Index (SOX) remained up by 2% and
the Nasdaq Composite Index (RIXF) trimmed most of its gains and was
up just 2 points at 2,794.
"There have been some crazy cross currents impacting tech," said
Brian Marshall, an analyst with Gleacher & Co. "Secular names,
which offer the best growth opportunities have all been taken out
back behind the woodshed. Then, on the other hand, we have safer,
more mature names with limited growth profiles such as IBM, Dell
and SAP, actually outperforming this year."
National Semi (NSM) shares surged more than 71% to $24.13 in the
wake of the acquisition, which was announced late Monday. The deal,
which has been approved by the boards of both companies, values
National Semi at $25 a share.
TI (TXN) shares rose 53 cents to $34.68 .
The deal marks a major consolidation in analog chips, where TI
and National Semi both have large market shares.
Among other chip stocks, big gains came from Intersil Corp.
(ISIL), up 95 cents a share, or almost 8%, to $13.10; Semtech Corp.
(SMTC), which rose $1.63 a share, or 6.7%, to $26.01, and On
Semiconductor Corp. (ONNN), up 32 cents a share, or more than 3%,
to $10.
Apple Inc. (AAPL) shares shed $3.04 to fall to $338.11. The
Nasdaq OMX (NDAQ) said it was rebalancing the Nasdaq-100 Index
(NDX) and would lower Apple's weighting to about 12% from more than
20%.
Nasdaq said the move was being made to better reflect the market
capitalizations of the index's stocks and would take effect on May
2.
Cisco Systems Inc. (CSCO) shares were up 19 cents at $17.25. In
a letter posted to Cisco employees on a company blog, Cisco Chief
Executive John Chambers that while he believes the networking
giant's strategy is sound, the company's operational execution has
been lacking and "we have disappointed our investors and we have
confused our employees."
Google Inc. (GOOG) fell $20.56 a share, or 3.5%, to $567.19.
Bloomberg News reported that Google could be subject to a U.S.
Federal Trade Commission antitrust investigation of the company's
share of the Web search market.
Among other tech stocks, gains came from Dell Inc. (DELL) as
well as Dow Jones Industrial Average components Microsoft Corp.
(MSFT) and Hewlett-Packard Co. (HPQ).