By Rex Crum and Dan Gallagher, MarketWatch
SAN FRANCISCO (MarketWatch) -- Tech stocks started the week on a
largely dismal note Monday. Wide selling started early and led to a
day of disappointment with most of the group closing in the red and
Apple Inc. leading the drop.
Apple (AAPL) ended the day with a loss of almost $11 a share, or
2.7%, to close at $402.54 after falling below the $400 mark earlier
in the day for the first time in two months.
Before the start of trading, Jefferies & Co. analyst Peter
Misek cut his price target on Apple's stock to $405 a share from
$420. In a research note, Misek also lowered his iPhone sales
estimate for the third quarter of the year to 27 million units from
30 million.
"We remain cautious on Apple as it fills in its product gap"
with what Misek estimates will be a 5-inch screen iPhone 6 next
year. Misek also said that checks in the smartphone industry
indicate longer inventory levels for mobile-network carriers,
suggesting that products are sitting on the shelves longer than
anticipated.
With Apple leading the decline, the Nasdaq Composite Index
(RIXF) fell more than 36 points, or 1%, to close at 3,320, while
the Philadelphia Semiconductor Index (SOX) gave up 2% and the
Morgan Stanley High-Tech Index (MSH) fell 1.5%. The Dow also fell
by almost 140 points, to close at 14,659 -- after having shed more
than 240 points earlier, as investors registered fears about a
possible liquidity crunch in China.
Microsoft (MSFT) was one of the few gainers, rising 1.4% to
close at $33.72. The software giant will kick off its Build
developers conference in San Francisco on Wednesday, where it is
expected to preview its coming Windows Blue update.
But most other major tech stocks closed in the red. Google Inc.
(GOOG) fell 1.3%, to close at $869.79, even though J.P. Morgan
analyst Doug Anmuth raised his price target on the company's stock
to $1,025 a share from $860 on overall positive sentiment for the
company's business efforts.
Dell (DELL) shares shed a penny each to close at $13.34. The PC
maker argued in a filing on Monday morning that a counterproposal
led by activist Carl Icahn "lacked credibility" and is risky.
Yahoo (YHOO) fell by 4.5%, to $24.07. The company will hold its
annual shareholder meeting on Tuesday morning. Facebook (FB) closed
with a loss of 2.4% at. $23.93.
Among other leading tech stocks, Intel Corp. (INTC) and EMC
Corp. (EMC) each gave up 2.5%; and Hewlett-Packard Co. (HPQ) ended
the day down by 3%.
One bright spot was Stec Inc.(STEC), which saw its shares almost
double, to close at $6.71, after hard disk-drive maker Western
Digital Corp. (WDC) said it would acquire the maker of solid state
drives for $340 million, or the equivalent of $6.85 a share.
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