Stocks fell for a third session on Friday, with disappointing earnings from Qualcomm, Inc (QCOM.OB) being the leading factor for the sharp sell off. Qualcomm, a leading wireless technology developer, released earnings and revenue significantly lower than analysts’ have previously expected. Other factors, such as Cisco Systems (CSCO) releasing disappointing financial statements and a bleak future outlook, led to Nasdaq’s biggest weekly point loss since September 11, 2001.
Not only that, but Fannie Mae (FNM.N), the largest source of mortgage financing, posted a third-quarter net loss that was double its loss from a year ago. The company’s share price ended the session down 1.6 percent at $49.00, after earlier dropping 10.6 percent to a fresh 52-week low at $44.54.
Similarly, Wachovia Corp (WB.N), the fourth largest US Bank, reported a potential loss of $1.7 billion. This huge loss led to Wachovia’s stock falling more than 5 percent to a 52-week low at $38.05, but rebounded to finish the day up 0.9 percent at $40.65.
The week’s disappointing news from various tech companies sparked concern that fallout from the credit crisis was directly related to tech companies. Many felt that the companies had their most important consumers in the credit industry. Technology, until now, has been a bright spot for the US markets.
Tim Ghriskey, chief investment officer of Solaris Asset Management, stated “It has seemed for a couple of days here we’ve been in a correction mode. Today certainly furthers that feeling. While technology has been leading the market recently, it’s a volatile sector, and you can’t forget that. With negative demand visibility looming, it’s probably going to be tough for technology to lead the market in the near term,” he said.
For the week, the Nasdaq lost 6.5 percent or 182 points. The Dow dropped 4.1 percent and the S&P 500 declined 3.7 percent.
For the last day of the week, DJIA was down 223.55 points, or 1.69 percent, at 13,042.74. The Standard & Poor’s 500 Index was down 21.07 points, or 1.43 percent, at 1,453.70. The Nasdaq Composite Indewas down 68.06 points, or 2.52 percent, at 2,627.94.
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