Russell 2000 falls at opening

Alex Alexandrov | Mar 04, 2008 10:08am EST | Comment

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The Russell 2000 (NYSE: IWM) is in negative territory following troubling news from the tech sector.

At 10:06 a.m. ET, the small-cap index was down 5.41 points, or 0.79%, to 678.81. The Dow Jones Industrial Average (INDU) had shed 89.14 points, or 0.73%, to 12,169.76.

Chip maker Intel Corp. (Nasdaq: INTC) announced after the close on Monday that it has lowered its first-quarter gross margin forecast to 54% from 56% earlier. The Santa Clara, Calif.-based company blamed lower-than-expected prices for some flash memory chips.

Meanwhile, shares of Apple Inc. (Nasdaq: AAPL) are sagging following news before the start of trading that two analysts have cut their price targets for the company’s stock.

Investors are also paying attention to U.S. Federal Reserve chairman Ben Bernanke, who is speaking at a conference of the Independent Community Bankers of America. The Fed chief is discussing ways to alleviate the burden on struggling homeowners, saying that the government and private sector could do more to cut down on the number of foreclosures.

Among small-cap tech players, shares of Palm Inc. (Nasdaq: PALM), which develops mobile computing solutions, are down. Shares of high-density computer servers provider Rackable Systems, Inc. (Nasdaq: RACK) have also fallen.

One of the few bright spots is Seattle-based supercomputers maker Cray Inc. (Nasdaq: CRAY), whose shares are flat.