By Benjamin Pimentel, MarketWatch
SAN FRANCISCO (MarketWatch) -- Technology stocks tumbled Friday
as the Nasdaq Composite Index shed 110 points with shares of
Microsoft Corp., Facebook Inc and Google Inc. leading the
retreat.
The Nasdaq (RIXF) dropped 2.6% to close at 4,128, its lowest
level in eight weeks. The benchmark also turned negative for the
week with a fractional loss, and was down 1.2% year-to-date.
Microsoft (MSFT) fell 2.8% to close at $39.87, one of the worst
performers on the Dow Jones Industrial Average(DJI), which was off
159 points. Cisco(CSCO), also weighed on the Dow. The stock shed
1.6% to close at $22.71. Facebook (FB) dropped 4.6% to close at
$56.75.
Shares of Micron Technology (MU), which rose early in the
session a day after the semiconductor company beat Wall Street's
earnings and revenue estimates, turned negative, shedding 6% to
close at $22.58.
Newly split Google stocks were in the red after posting gains on
their first day of trading on Thursday. The Class A Google shares
(GOOGL) were down 4.6% to close at $545.25, while the nonvoting
Class C shares (GOOG) were off 4.7% to close at $543.14.
On the upside, shares of GrubHub (GRUB), the online food
delivery company, jumped 30.8% to close at $34 as the company began
trading on the New York Stock Exchange.
The session began on an upbeat note for Micron as executives at
the Boise, Idaho-based chip company painted an upbeat picture of
the memory-chip market and reported a sharp gain in sales.
"We've seen pretty good demand signals on the memory side,"
Micron President Mark Adams said. "We feel pretty bullish for the
memory market for consumer and client devices," he added, as he
also pointed to strong demand in the server and networking
market.
Micron has been going through a transition following its
acquisition of another memory chip company, Elipida, which was
widely expected to strengthen its market position, and a fire that
damaged the plant of rival Hynix, which limited supply of DRAM
chips.
On the call with analysts on Thursday, Adams said the DRAM
market "has normalized following the recovery of one of our
competitor's fabs in China." Still, he added, "DRAM market
conditions remain favorable. And inventories in the channel remain
relatively tight below normal levels."
Topeka Capital analyst Suji De Silva raised his price target for
the stock to $27 from $25. "With healthy supply-demand balance and
pricing, Micron margins improved and we expect the company to
sustain these higher margin levels going forward," he told
clients.
"We also believe Micron demand is firming across multiple end
markets, supported by the company's product development efforts,"
he added.
The Morgan Stanley High Tech 35 Index (MSH) and the Philadelphia
Semiconductor Index (SOX) were each down more than 2%.
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