Downbeat Cisco sends stocks skidding on Wall Street

Stocks on Wall Street slumped as disappointing news from Cisco Systems hit technology stocks hard and dragged the broader market lower.The Dow Jones Industrial Average was down 73.94 points, or 0.6%, to 11,283.10 at the close (10am NZ time).Cisco led the blue-chip index's decline, plunging 16% and erasing nearly two months of gains, after a weaker-than-expected sales forecast. Investors wiped as much as $US24 billion from the company's market value.

Stocks on Wall Street slumped as disappointing news from Cisco Systems hit technology stocks hard and dragged the broader market lower.

The Dow Jones Industrial Average was down 73.94 points, or 0.6%, to 11,283.10 at the close (10am NZ time).

Cisco led the blue-chip index's decline, plunging 16% and erasing nearly two months of gains, after a weaker-than-expected sales forecast. Investors wiped as much as $US24 billion from the company's market value.

Cisco said its first-quarter profit rose 8% from a year ago, but warned of slower revenue growth, citing weakening orders from cable-TV operators and government agencies.

Cisco's results weighed on Hewlett-Packard, Microsoft, IBM and Intel, which were all among the Dow's biggest decliners. IBM's 1.3% drop combined with Cisco's decline to account for roughly half of the Dow’s fall.

The technology-heavy Nasdaq Composite, which has risen in 21 of the last 25 trading days, was down 10.9% at 2555.52. The S&P 500 index fell 0.4% to 1213.54, with technology and financial stocks leading the declines.

Other markets: Europe down, Asia mixed
European stock markets edged lower in cautious trade with continued concerns over euro-zone government debt pressuring banks and taking the shine off healthy corporate earnings and a buoyant resource sector.

The Stoxx Europe 600 was down marginally at 271.69. London's FTSE 100 Index was 0.2% lower at 5807.13, Frankfurt's DAX was 0.1% lower at 6711.21 and Paris' CAC-40 Index was off 0.5% at 3866.43.

Chinese and Hong Kong stocks rebounded as investors bought into banking and resource shares, even as news of increasing inflation fueled fears of more interest-rate increases.

Korean and Indian shares retreated as investors locked in recent gains, with Seoul stocks suffering a late selloff ahead of options' expiry in the market.

Japan's Nikkei Stock Average rose 0.3% to 9861.46, while Hong Kong's Hang Seng Index climbed 0.8% to 24700.30 and China's Shanghai Composite gained 1% to 3147.74, with both benchmarks rebounding after falling in the previous two sessions.

Korea's Kospi fell 2.7% to 1914.73, India's Sensex lost 1.4% to 20589.09 and Taiwan's Taiex slipped 0.2% to 8436.95. Australia's S&P/ASX 200 rose 0.6% to 4728.57.

Commodities: Oil, gold up
Crude-oil prices rose then retreated to finish unchanged after strong economic data from China.

The futures contract for December delivery settled at $US87.81 a barrel in New York, after rising as high as $US88.63. Brent crude on the ICE futures exchange fell 15USc, or 0.2%, to $US88.81 a barrel.

Surging consumer prices in China and fretting about global currency weakness sent investors back to gold as an inflation and currency hedge.

The most actively traded contract, for December delivery, settled $US4.00, or 0.3%, up at $US1403.30 an ounce in New York.

Currencies: Euro down, dollar up
The euro slumped to the weakest point in more than a month against the dollar as concerns again heated up over Europe's simmering issues of sovereign debt.

In one sign of the increasing worry over the region's fiscally stressed periphery, the cost to insure against default on government debt issued by Portugal, Ireland and Spain hit records.

The euro weakened to $US1.3656 from $US1.3779 late on Wednesday, after touching $US1.3642.

The dollar was at ¥82.43 from ¥82.32. The euro weakened to ¥112.57 from ¥113.42. The UK pound moved to $US1.6129 from $US1.6119.

The dollar strengthened to 0.9766 Swiss franc from 0.9712 franc.