By Benjamin Pimentel, MarketWatch
Technology stocks were modestly lower Monday morning, led by
shares of Apple Inc. which slipped back below the $600 mark.
Apple (AAPL) shed nearly 2% to $591.90 in early trading, as the
Nasdaq Composite Index (RIXF) edged down by 0.5% to 3,053. The
Philadelphia Semiconductor Index (SOX) also was down a
fraction.
Also weighing down the sector were shares of Netflix Inc. (NFLX)
which lost more than 3%.
Apple was highlighted in a lengthy report by the New York Times
over the weekend, which took a look at the methods the company uses
to minimize the taxes it pays. The article noted that these methods
are used by many high-tech firms and companies in other
industries.
Shares of Microsoft Corp. (MSFT) traded mostly flat after the
software giant unveiled a digital-reader partnership with
bookseller Barnes & Noble (BKS) , whose shares soared more than
60%.
Shares of Demand Media Inc. (DMD) jumped more than 23% to $9 on
Monday morning following a report over the weekend that the company
pulled out of a deal to go private.
According to a report by the AllThingsD tech blog, Demand Media
was "deep into discussions" with Thomas H. Lee Partners - a
Boston-based private equity firm - to go private in a $1.2 billion
deal. Citing unnamed sources, the story said Demand pulled out of
the deal for reasons that included "complications related to its
financing and the ability to retain executives in its
aftermath."
Evercore downgraded shares of Demand Media to equal-weight on
Monday, noting that the stock has now reached the broker's price
target in relation to the news.
"We believe the reported discussions speak to the attractive
valuation of Demand Media, particularly given the unfolding,
potential boom in domain name registrations in light of recent
actions by ICANN. DMD is a leading participant in the domain name
market," analyst Ken Sena wrote.
Shares of Nvidia Corp. (NVDA) were off a fraction at $12.96.
ThinkEquity analyst Suji De Silva trimmed his price target for the
chipmaker's stock to $14 from $15, while maintaining a hold
rating.
"We expect Nvidia to benefit from recovering broader demand, but
expect consumer PC recovery to be measured and limited near-term
upside. We also expect handset revenue headwinds as Samsung
transitions to an in-house application processor from Nvidia," he
wrote.