By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Tech stocks ran out of steam in
late trading Wednesday, and most of the sector closed in the red
with declines from Microsoft Corp. and other software companies
offsetting mild gains from Amazon.com Inc., which expanded its
efforts in the grocery delivery business.
Amazon (AMZN) rose $1.47 a share, to close at $267.17 after the
online retailing giant added metropolitan Los Angeles to the areas
available for its AmazonFresh grocery delivery service. Prior to
adding L.A., Amazon only offered grocery delivery in its hometown
of Seattle.
Mark Mahaney, of RBC Capital Markets, said in research note that
the expansion of grocery delivery "makes strategic sense as part of
AMZN's long standing efforts to expand into more consumer offerings
and to take advantage of its low cost infrastructure advantage and
expanded U.S. fulfillment center footprint."
The move comes one day after Amazon said it had reached a deal
with Viacom Inc. (VIA) to carry programs from the Nickelodeon, Nick
Jr. MTV and Comedy Central networks over its Amazon Prime Instant
video service.
Netflix Inc. (NFLX), which gave up the Viacom programming in
May, gave up $1.85 a share to fall to $223.46.
Dell Inc. (DELL) managed to eke out a gain of a penny a share to
close at $13.43. The battle to take the PC company private heated
up, as a special committee of Dell board members said an offer by
activist investor Carl Ichan falls short by $4 billion and restated
its support of a $24.4 billion buyout proposal from Chief Executive
Michael Dell and private equity firm Silver Lake Partners.
Microsoft (MSFT) was among the decliners, giving up 21 cents a
share to close at $34.78, as Deutsche Bank cut its rating on the
company to hold from buy.
VMware Inc. (VMW)shares shed 2.5% to end the day at $66.93,
while Intuit Inc. (INTU) gave up 21 cents a share to close at
$57.57, as Deutsche Bank also cut the ratings on the software
companies to hold from buy.
Losses also came from Apple Inc. (AAPL), IBM Corp. (IBM),
Hewlett-Packard Co. (HPQ), Yahoo Inc. (YHOO), eBay Inc. (EBAY) and
Intel Corp. (INTC).
The Nasdaq Composite Index (RIXF) fell almost 44 points to close
at 3,401, while the Philadelphia Semiconductor Index (SOX) gave up
more than 1.5%.
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