By Benjamin Pimentel
The tech sector traded up Wednesday even as shares of Texas Instruments Inc. fell on what analysts said was likely a wave of profit-taking.
After struggling in the red earlier in the day, the Nasdaq Composite Index (RIXF) gained a fraction to 2,178 with an hour left in the session.
TI was in the spotlight after the Dallas-based chip behemoth (TXN) narrowed its earnings outlook late Tuesday, pointing to a strong fourth quarter, but some analysts said investors' expectations may have been overheated.
"I think the sentiment has gone a bit too high," Wedbush analyst Patrick Wang said in a phone interview Tuesday, noting that the stock's decline after the company's mid-quarter update may have been due to investors taking profits.
In a note Wednesday, Wang said TI management "continues to flawlessly execute on its analog/embedded strategy, driving share gains and outsized growth in today's recovering economy."
Shares of TI were off 1.6%.
TI's downward trajectory had set the tone for the sector, but tech stocks recovered as the day ended. The Morgan Stanley High Tech 35 Index (MSH) and the Philadelphia Semiconductor Index (SOX) each also traded up fractionally.
There were bright spots for the sector.
Shares of Apple Inc. (AAPL) gained more than 3% after an Oppenheimer analyst said the computer maker is ramping up production on the much-anticipated tablet.
RealNetworks Inc. (RNWK) saw its shares rise more than 14% after J.P. Morgan upgraded the digital-media company's stock to neutral from underweight, citing a better-than-expected ruling in its arbitration with VeriSign Inc. (VRSN). VeriSign was down 1.6%.
Shares of Rambus Inc. (RMBS) rose more than 2% after the chip-design company reached a settlement with the European Commission in a dispute over patent royalties.