Tech disappointments
put damper on stocks

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By Amy Baldwin
Associated Press

NEW YORK >> Frustrated by a still elusive business recovery, investors sold stocks lower today when Nokia reported a drop in profits and sales and Advanced Micro Devices offered a weak outlook for the second quarter.

"The majority of companies are coming out with shaky news. One day they say they see signs of a turnaround, then they say, 'We were premature.' The turnaround is not coming as quickly as people thought," said Al Mirman, strategist at V Finance in Sarasota, Fla.

The market rebounded from sharper losses suffered at midday when a small plane hit a skyscraper in Milan, Italy that houses local regional government offices. Later reports indicated the crash was an accident, and that the pilot had sent out a distress call.

The Dow Jones industrial average closed down 15.50 at 10,205.28 The Dow had fallen as much as 163.06 at midday when investors increased their selling based on fears of more terrorist attacks. The Nasdaq composite index fell 8.24 to 1,802.43, and the Standard & Poor's 500 index slipped 1.60 to 1,124.47.

Decliners edged advancers on the New York Stock Exchange, with 1,592 down, 1,543 up and 212 unchanged. Volume was 1.35 billion shares.

The NYSE composite index fell 0.53 to 592.95, the American Stock Exchange composite index gained 5.28 to 923.63 and the Russell 2000 index slipped 0.21, or 0.04 percent, to 518.56.

The Treasury's 2-year note rose 2/32 to 1001832; its yield fell 4 basis points to 3.32 percent. The 10-year note gained 532 to 971432; its yield lost 2 basis points to 5.21 percent. The 30-year bond rose 1032 to 951 1/32; its yield fell 2 basis points to 5.70 percent.

A lukewarm economic report failed to trigger buying today. The Conference Board said its Index of Leading Economic Indicators -- a key gauge of the direction of the U.S. economy -- inched up 0.1 percent last month after holding steady in February.

Among today's losers, cell phone maker Nokia fell $2.53, or nearly 12.3 percent, to $18.10 after reporting first-quarter profits fell 8.5 percent and sales declined 12 percent. Nokia also reduced its sales outlook for the remainder of the year.

Chip maker AMD recorded a smaller-than-expected loss for the first quarter, but fell $2.22, or 15 percent, to $12.60 after saying it still faces tough business conditions.

AMD Chief Executive W. J. Sanders III said second-quarter sales will be lower than the first quarter's, and that it will be hard for AMD to continue gaining market share because the biggest growth areas in the PC market are weak spots for the company. Analysts also don't expect AMD to be profitable until the third quarter.

There were also earnings-related winners today. Dow industrial American Express rose $1.24 to $42.39 after reporting its profits beat projections by 3 cents a share.

And, McDonald's, also a Dow stock, climbed $1.45 to $28.61 after beating earnings expectations by 2 cents a share and saying it will surpass Wall Street's forecast for 2002.

After the market closed, Microsoft Corp. said fiscal third-quarter sales and earnings rose less than forecast and reduced estimates for this quarter and fiscal 2003.

Net income in the period ended March 31 rose to $2.74 billion, or 49 cents a share, from $2.45 billion, or 44 cents, a year earlier. Analysts had forecast 51 cents a share.

Sales rose 13 percent to $7.25 billion from $6.4 billion.

The software maker said it will miss analysts' sales and profit estimates for the quarter ending in June and the year starting in July. Microsoft has said worldwide demand for software has been slow to pick up as the U.S. economy rebounds from a recession that began in March 2001.