By Dan Gallagher, MarketWatch
SAN FRANCISCO (MarketWatch) -- Tech stocks ended up putting in a
roundly negative trading session Monday, with a market-wide selloff
pushing the sector deeper into the red, despite isolated gains at
Sprint Nextel Corp. and Netflix Inc.
Sprint held on to its gains, and rose 13.5% to close at $7.06 on
the strength of an unsolicited takeover bid from Dish Network.
Meanwhile, Netflix rose almost 2% after one Wall Street broker set
a $250 price target on the online movie firm.
By the time the market closed, the Nasdaq Composite Index (RIXF)
had fallen more than 78 points, or 2.4%, to close at 3,216. The
Philadelphia Semiconductor Index (SOX) fell 2.5% and the Morgan
Stanley High-Tech Index (MSH) fell 2%.
The Dow slid almost 266 points to close at 14,599 following data
from China that showed economic growth slowing. The selloff also
pushed gold prices to their worst one-day drop in years.
Among big tech names, Apple (AAPL) fell 2.3%, while Amazon.com
(AMZN) and Cisco Systems (CSCO) each fell about 2%, and Facebook
(FB) shares shed more than 3%.
However, Sprint's (US-S) gains kept the stock above the $7 mark
for the first time since fall 2008. Dish Network Corp. (DISH)
announced an unsolicited $25.5 billion bid for Sprint that involves
about $4.76 per share in cash and about $2.24 per share in Dish
stock.
The proposed deal could derail a pending merger between Sprint
and Softbank Corp., the Japanese telecommunications giant that
offered to buy about 70% of Sprint in a $20 billion deal.
In a conference call on Monday morning, Dish chairman Charlie
Ergen touted the advantages his company could bring compared with
Softbank, including a large block of domestic spectrum.
"Obviously, we're talking about bringing some things that
SoftBank just can't bring to create a superior company," he said on
the call, adding that his offer also brings about $24 billion in
"new opportunity synergies" to the deal.
Sprint issued a brief statement saying it had received the Dish
offer and that its board of directors "will evaluate this proposal
carefully and consistent with its fiduciary and legal duties."
Dish shares fell more than 2% to $36.77. Rival carriers AT&T
(T) and Verizon (VZ) also closed in the red. Verizon has reportedly
offered to pay about $1.5 billion to acquire wireless spectrum from
Clearwire (CLWR) , according to The Wall Street Journal. Clearwire
shares fell 3.4% to close at $3.15.
Among smaller wireless-network carriers, MetroPCS (PCS) shares
fell 4% and Leap Wireless (LEAP) ended the day down by 2.6%.
Netflix (NFLX) got a boost after BTIG analyst Richard Greenfield
initiated his coverage of the stock with a buy rating and
$250-a-share price target. In a research note, Greenfield said,
"The improving Netflix price/value relationship, along with
high-quality, proprietary original programming will drive better
than expected subscriber growth and moderate [subscriber]
churn."
Google (GOOG) shares gave up 1% to close at $781.93, following
reports that the company had made a proposal to tweak its search
results to ease anticompetitive concerns raised by the European
Union.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires