Wall Street: Tuesday close

TECH investors threw in the towel in late trading for the second straight day, driving US markets to levels not seen since October.

The biggest hit came in the Nasdaq Index, which slumped 33.51 points or 2.19% to 1,497.18, down 23.2% on the year. The Nasdaq is in line for its third straight losing year after peaking at 5,048 on 10 March 2000. The Dow Jones Industrial Average surrendered a triple digit gain to finish down 128.14 points or 1.33% to 9,517.26, off 5% for the year.

Major intra-day reversals in tech bellwethers including Intel took the wind out of investors' sails. Intel, up 3% at mid-session, finished lower by 85 cents or 4% to $20.22. Microsoft, which sported a 2% gain at lunch, closed down 25 cents or 0.5% to $52.57. IBM gave up all of its early 1.5% advance to end the day off $1.31 or 1.7% at $75.49.

Analysts attributed the sell-off in part to gloomy presentations at a tech conference hosted by broker Bear Stearns in New York. Companies, while not commenting on their particular circumstances, indicated that they had not seen any uptick from what one executive said was a 'U-shaped bottom - we hope.' The downbeat message was consistent through semiconductors, software and hardware manufacturers, participants said.

Markets have been fluctuating on hopes that a reviving US economy will eventually boost company profits. But some economists have been warning that the recovery is not strong enough to support a rebound in a tech sector still working off the excesses of the last decade.

The early rally was stoked by what investors saw as encouraging news out of the wireless sector, specifically from mobile phones maker Nokia and wireless service provider Nextel.

Nokia, while chopping sales forecasts for second quarter sales, stuck by its profit targets. Nokia shares jumped 53 cents or 4.4% to $12.53.

The statement fed hopes that the worst might be over for the sector, but the buying did not extend to arch rival Ericsson, which was marked down 17 cents or 8.6% to $1.81. Nextel climbed 63 cents or 17% to $4.42 on word that it might top its targets.

Conglomerate Tyco International, besieged by questions about its management, slumped another 35 cents or 3% to $11.05, down from $60 in January, on reports that the Securities and Exchange Commission had reopened an investigation into its bookkeeping.

Giant pharmaceutical Merck dipped $2.42 or 4.5% to $51.88 after the Food and Drug Administration requested more information before moving ahead on the approval process for the pain relief drug Arcoxia. Rival Abbott Labs tumbled $7.37 or 16% to $38.30 as it said it would fall short of 2002 forecasts.

Wal-Mart, which helped steady the Dow on Monday with higher sales forecasts, clung to a fractional gain to close at $56.45.