Preseason Slump - Industry Trend or Event

Earnings announcements shook the market as several companies, notably chip giant Intel, warned that third-quarter earnings would be below analyst expectations. The Nasdaq composite ended the week down 32 points, or 0.8 percent, at 3804. TheStreet.com's Internet Sector index fell 0.7 percent to 780. The Dow Jones Industrial Average closed down 81 points to 10846

Intel said sluggish sales in Europe led to slower revenue growth rates and slimmer gross margins than expected. Its stock fell 24 percent from last week's high. The news hammered down shares of other chipmakers, as well. Advanced Micro Devices was off 15 percent, and Applied Materials was off in percent from Wednesday's closing values.

Other stocks slid on news that revenues would be slower than forecasted. Sprint PCS closed the week down 41 percent after the company admitted subscriber growth was disappointing. Net design-software maker Allaire lost 47 percent after slack demand hurt revenues. And e-commerce software maker, Clarus, fell 30 percent on concerns it would miss revenue targets.

In a rare bright spot, Adobe bucked the downward trend: It announced a third-quarter profit increase of 37 percent. The news sent its shares up 13 percent on the week. Other stocks fared well. EBay rose 7 percent this week, Ariba gained ii percent and CommerceOne increased 8 percent.

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