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Optical/IP

Bears Rip Through Market

Technology terror continued on Tuesday, as a brutal market selloff kicked off the new year on the stock market.

The Light Reading Index lost 62.81 points to close at 618.40 today, down 9 percent amidst heavy trading. The plunge reflects the widespread gloom in the technology sector, fueled by a wash of revenue warnings over the past few weeks. The Nasdaq Composite Index lost 178.66 points, or 7.23 percent, to close at 2291.86.

Leading the news today was Extreme Networks Inc.'s (Nasdaq: EXTR) announcement that it would purchase Optranet Inc., a player in broadband IP services, in a stock deal worth about $57 million (see Extreme Spins In Optranet). The move struck some as peculiar and the company offered little comment, citing quiet-period restrictions. Extreme closed down $11.50 (26.84%) to $28.63.

Several rumors circulated about Cisco Systems Inc. (Nasdaq: CSCO). One was that they might miss their quarter; another, that they might be losing key personnel. Such talk, in concert with the market conditions, sent the stock down 14.38 percent to $32.75. Cisco officials had no comment. Cisco’s competitor Juniper Networks Inc. (Nasdaq: JNPR) closed down 18.64 percent to $102.56, giving up territory it had gained last week (see Juniper Eats Into Cisco's Lunch).

Other leading losers today were:

  • Avanex Corp. (Nasdaq: AVNX), down 20.46 percent to $47.38
  • Brocade Communications Systems Inc. (Nasdaq: BRCD), down 22.87 percent to $70.81
  • Corvis Corp. (Nasdaq: CORV), down 20.73 percent to $18.88
  • Ciena Corp. (Nasdaq: CIEN), down 18.77 percent to $66.00
  • MRV Communications Inc. (Nasdaq: MRVC), down 18.22 percent to $10.94
  • New Focus Inc. (Nasdaq: NUFO), down 17.09 percent to 28.81
  • ONI Systems Inc. (Nasdaq: ONIS), down 24.33 percent to $29.94
  • Redback Networks Inc. (Nasdaq: RBAK), down 21.95 percent to $32.00
  • Sycamore Networks Inc. (Nasdaq: SCMR), down 16.61 percent to $31.06
  • Vitesse Semiconductor Corp. (Nasdaq: VTSS), down 17.29 percent to $45.75.

    -- Matt Malina, research associate, Light Reading http://www.lightreading.com

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