Tech stocks suffer dramatic downturn

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Tech stocks were hit hard on Monday as Congress rejected the US$700 billion bailout bill.

Google's stock plunged a shocking 11.6 per cent to close at $381 - falling below $400 for the first time in two years. Intel, Sun Microsystems and Yahoo each declined more than 10 percent.

Even Microsoft felt the effects of a severe economic downturn as its shares fell 8.7 per cent. Microsoft general counsel Brad Smith begged the House of Representatives to "reconsider and support legislation that will reinstill confidence and stability in the financial markets".

Other companies that fell victim included Dell, whose shares declined 9.4 per cent Monday, HP, 6.8 per cent and Oracle, by 9 per cent.

Trip Chowdhry of Global Equities Research told investors that a number of Silicon Valley companies will struggle in the face of a continuing economic downturn. Chowdhry also noted that high oil prices were dragging down the US economy and forcing consumers to reduce their budgets for tech purchases. (c) 2010 Incisive Media

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