Sign in Subscribe
Semiconductor industry

Tech Stocks Plummet Amid Intel Warning and Economic Fears

Strategic Insights

— 1 min read

The stock market experienced a significant decline on Thursday, as Intel's warning about lower-than-expected computer chip sales sparked fears of a slowing tech boom. Despite increased factory orders in January, the overall economic impact of the Asian financial crisis remains uncertain. The tech sector suffered further losses as Computer Associates ended its attempted takeover of Computer Sciences Corp., and Unit 2 at Wisconsin Electric's Point Beach Nuclear Plant was shut down for repairs. Meanwhile, Ameritech Corp. plans to petition the U.S. Federal Communications Commission to relax regulations on data delivery.

Key Takeaways:

  • Intel's warning about lower-than-expected microprocessor sales sent its stock plummeting by as much as 13 percent, affecting other tech stocks in the process.
  • Computer Associates ended its $9.2 billion buyout offer for Computer Sciences Corp., causing a significant drop in Computer Sciences shares.
  • Unit 2 at Wisconsin Electric's Point Beach Nuclear Plant was shut down for repairs after engineers identified a design problem with the cooling water system.
  • Ameritech Corp. will request the removal of regulations that hinder its ability to deliver data over long distances, in line with the 1996 federal Telecommunications Act.
  • Orders to U.S. factories rose by 0.5 percent in January, a sign that the Asian financial crisis has yet to have a significant impact on the economy.
  • The Commerce Department reported a 2.6 percent drop in December, marking the worst performance for American manufacturers in more than five years.

Statistics:

  • Intel's stock plummeted by as much as 13 percent.
  • Computer Sciences shares fell by 11 percent, closing at $94.
  • Computer Associates shares rose by 3 percent, closing at $48.9375.
  • Orders to U.S. factories rose by 0.5 percent in January.
  • December's drop in factory orders was 2.6 percent, marking the worst performance in more than five years.

Sources:

  • Intel Corp.
  • Dow Jones industrial average
  • Commerce Department
  • Computer Associates International
  • Computer Sciences Corp.
  • Ameritech Corp.
  • Wisconsin Electric's Point Beach Nuclear Plant
  • U.S. Federal Communications Commission (FCC)

Read more