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U.S. Stocks Fall for 10th Week in 12

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    http://www.bloomberg.com/bbn/snapshot.html
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    Stock Market Update
    ----------------------------------------------------- 06/07 10:29
    U.S. Stocks Fall for 10th Week in 12 as Intel Cuts Forecast, Tyco Tumbles
    By Danielle Sessa
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    New York, June 7 (Bloomberg) -- U.S. stocks fell, sending benchmark indexes to their biggest weekly losses since the first five trading days after the Sept. 11 terrorist attacks. Intel Corp. sparked a selloff in markets from Tokyo to London after cutting its sales forecast.
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    ``When I heard the Intel news, I threw in the towel on this market,'' said Jack Ablin, who oversees $37 billion as chief investment officer at Harris Trust & Savings Bank in Chicago.
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    Tyco International Ltd. plunged to its lowest level since July 1996 on concern a delay in the sale of its CIT finance unit will strain the company's finances. Tyco said it will begin its own probe of the use of funds by ousted Chief Executive Officer Dennis Kozlowski.
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    The Standard & Poor's 500 Index dropped 11.45, or 1.1 percent, to 1017.70. Computer-related shares accounted for more than half the slide. The Dow Jones Industrial Average declined 116.24, or 1.2 percent, to 9508.40. The Nasdaq Composite Index shed 50.27, or 3.2 percent, to 1504.61.
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    The S&P 500 has slumped 4.7 percent this week, the Dow 4.2 percent and the Nasdaq 6.9 percent. Ablin said the S&P 500, already down 11 percent this year, must drop another 10 percent to 12 percent to reflect a realistic earnings outlook.
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    Germany's DAX Index slumped 2.4 percent, France's CAC 40 Index fell 2.4 percent and Britain's FTSE 100 Index dropped 1.2 percent. Japan's Nikkei 225 Index fell 1.2 percent.
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    ``We could get a real bloodbath,'' said Al Goldman, chief market strategist A.G. Edwards & Sons in St. Louis. ``There's a real cloud over the market. There's a subliminal fear over what's going to happen'' next to drive stocks lower.
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    Stocks were also hurt after a government report showed the U.S. economy added fewer jobs than expected in May. The Labor Department said payrolls rose by 41,000 last month, missing analysts' estimates of 68,000, according to a Bloomberg survey.
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    Only 25 Worth Buying
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    ``I can't think of more than 25 stocks in the whole U.S. market that I'd want to buy right now,'' Anais Faraj, an equity strategist at Nomura International, said on Bloomberg Television. ``We're less concerned about the U.S. economy than we are about the U.S. stock market.''
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    Some 357 million shares traded on the New York Stock Exchange by 10:15 a.m. New York time, up 80 percent from a week ago. More than two stocks fell for every one that rose on the Big Board and the Nasdaq Stock Market.
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    Intel tumbled $5.14, or 19 percent, to $21.86. The world's biggest semiconductor maker said revenue will be $6.2 billion to $6.5 billion in the quarter ending June 29, less than its April forecast of $6.4 billion to $7 billion. The company also said second-quarter gross margins will be 49 percent, missing its 53 percent target.
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    The company said demand in Europe has been less than expected and microprocessor shipments are at the low end of the normal pattern for this time of year.
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    Advanced Micro, Applied Materials Slide
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    Advanced Micro Devices Inc., Intel's main rival in the market for PC processors, shed $1.21 to $9.40; Applied Materials Inc., the largest maker of semiconductor equipment, dropped 92 cents to $19.99; and Dell Computer Corp., the world's second-biggest PC maker, dropped $1.24 to $25.23.
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    Investors had been betting that demand for computer-related products would rebound as the U.S. and European economies picked up. Intel's cutting its sales targets suggests companies are postponing technology products.
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    ``The PC area is not going to be the dominant growth area over the next 10 years,'' said Edward Hemmelgarn, president of Shaker Investments Inc., which manages $2.3 billion in Cleveland. ``Intel had unit growth but they don't have the pricing power.''
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    Tyco fell $4.16, or 28 percent, to $10.45. The company's plan for a public offering of its CIT Group finance unit is being held up because the Securities and Exchange Commission has more questions, people familiar with the transaction said.
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    RF Micro Plunges
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    RF Micro Devices Inc. plunged $5.06 to $10.18. The maker of chips for mobile phones reduced its fiscal first-quarter profit forecast because customers delayed orders. The company expects to break even in the quarter ending in June, down from its earlier prediction of a profit of 2 cents to 3 cents a share.
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    Nokia Oyi, the biggest maker of mobile phones, fell 97 cents to $12.05; Texas Instruments Inc., the largest maker of chips for mobile phones, slid $1.95 to $25.74; and Qualcomm Inc., the biggest maker of semiconductors for Verizon Wireless Inc. phones, declined $1.23 to $29.53.
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    Biogen Inc. fell $6.30 to $41.40. The drugmaker lowered its second-quarter and full-year earnings forecasts as U.S. sales growth slowed and wholesalers cut their inventory of its multiple sclerosis drug Avonex.
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    The Russell 2000 Index of smaller stocks fell 4.25, or 0.9 percent, to 461.04. The Wilshire 5000 Total Market Index, the broadest measure of U.S. shares, slid 96.91, or 1 percent, to 9647.49.
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