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Throughout much of the day, stocks traded higher, overcoming early anxiety about the fiscal cliff and other political and macroeconomic worries on the back of a favorable earnings report from Home Depot. But, perhaps the realization that it will take weeks, if not months, to resolve all the outstanding issues plaguing world markets, dampened enthusiasm, and pulled stocks back down, causing the Dow Jones Industrials (INDEX: ^DJI ) to finish the day with a 59-point loss.
As has happened often over the past month or so, tech stocks were particularly weak. Microsoft (Nasdaq: MSFT ) was the big loser on the day, falling 3%, after Windows Division President Steven Sinofsky left the company yesterday. Clearly, investors are concerned that the departure indicates weak performance from Microsoft's recent Windows 8 release and, given how important that software is for Microsoft's future, uncertainty is giving them cause to bid down the share price.
Yet, Microsoft isn't the only tech giant suffering today. Intel (Nasdaq: INTC ) and Hewlett-Packard (NYSE: HPQ ) also fell more than 2%. Even news that rival Advanced Micro Devices (NYSE: AMD ) could be looking to make a major strategic move, having reportedly hired consultants JPMorgan Chase to look at a sale or other potential options, didn't give Intel much of a pop, although it sent AMD shares soaring. The muted response for Intel shows that AMD isn't really the important rival for Intel right now, with mobile chips being far more important to the future of the industry.
Meanwhile, for Hewlett-Packard, any bad news for Windows is a short-term negative. Although the company is moving away from its PC emphasis, that division is still important for HP. If Windows 8 proves to be a bust, then HP will have to move even faster to move toward more lucrative business lines.
Will tech rise again?
When it comes to dominating markets, both Microsoft and Intel had their turn in the limelight. But, especially for Intel, it's becoming increasingly hard to tell what the future will hold. Is Intel a buy at its depressed level, or are shareholders correctly discounting the company's questionable prospects? Get the latest in this premium research report on Intel, in which our analyst runs through all of the key topics investors should understand about the chip giant. Better yet, you'll continue to receive updates as news develops for an entire year. Click here now to learn more.