By Benjamin Pimentel
The tech sector advanced Monday morning, as shares of Brocade
Communications soared on a news that the networking gear maker was
up for sale.
Brocade (BRCD) was up more than 15% in the opening minutes of
trading, after the Wall Street Journal reported, citing unnamed
sources, that the company was considering selling the company.
The Nasdaq Composite Index (RIXF) rose 0.1% to 2,050, while the
Morgan Stanley High Tech 35 Index (MSH) added 0.1% and the
Philadelphia Semiconductor Index (SOX) was up 0.2%.
The tech sector got a boost from other players, including
Research In Motion (RIMM) and SanDisk Corp. (SNDK), shares of which
each gained more than 2%.
Meanwhile, shares of Advanced Micro Devices (AMD) sank more than
2% after FBR Capital Markets downgraded the chip maker to market
perform from outperform, citing a "potential PC build pull-in."
Analyst Craig Berger said that, based on checks with contacts,
"October builds will be the peak for PCs in 2009, whereas, usually
November is the peak build month."
"While we do not want to get overly bearish on the PC space
given improving global demand and unknown holiday sell-through
trends, we feel these actions are prudent given peaking near-term
momentum, more downstream inventory to digest (at least in China),
and a potentially overheated PC supply chain," Berger wrote.