Tech concerns put bearish pressure on stocks Thursday. The Dow ($INDU) ended the session with a loss of 120.40 points to close at 12,302.46. The S&P 500 ($SPX) fell 15.37 points, closing at 1,325.76. The NASDAQ ($COMPQ) gave up 43.53 points, 1.87 percent, to close at 2,280.83. Volume remained light on the session with 1.43 billion shares traded on the NYSE and 2.02 billion shares exchanged on the Naz. Market breadth was negative by a 12-to-20 and 11-to-18 margin on the Big Board and Naz respectively.

The tech sector led the decline Thursday led by shares of Google (GOOG) and Oracle (ORCL). Economic data was mostly in line with expectations, but crude prices continued to rise on further tensions in Iraq. Today’s declines took the major market indices below their 50-day moving averages and this could spell trouble for stocks next week if we don’t see a recovery on Friday.

GOOG shares fell 3.1 percent Thursday after comScore report that paid clicks for the company were disappointing. This convinced Lehman Brothers to lower its price target on GOOG shares to $580 from $644. However, the stock is sitting at $444, so Lehman still has an “Overweight” rating on the stock.

Shares of ORCL gave up 7.2 percent today to close the session at $19.43. The software giant reported in line earnings last night for its fiscal third quarter, but fell short on revenues. This news put pressure on other software makers, including SAP (SAP), which fell 6.0 percent to $48.80.

In economic news, the final revision to fourth quarter GDP remained at 0.6 percent growth. However, the GDP price index was revised to 2.4 percent growth, 3-tenths lower than expected. Though anemic, growth was positive in the fourth quarter, something that is in question in the first quarter.

In other news, jobless claims fell by 9,000, but remained elevated at 366,000. This put the four-week moving average at 358,000, above the level seen throughout most of February. Of course, nonfarm payrolls data has been very week the past few months and it seems more weakness is in store, although things do not seem to have worsened.

Oil prices were a concern Thursday as well with crude moving back above $107 a barrel. There are reports that a pipeline in Iraq was bombed Thursday and this raised concerns about the situation with supply. Of course, high energy prices are a definite concern for consumers and this has been evident by the decline in consumer sentiment and spending.

Jody Osborne
Senior Writer & Options Strategist
Optionetics.com ~ Your Options Education Site