Tech takedown looms

Nasdaq looks to open lower after Adobe's disappointing outlook; investors look ahead to latest reading on real estate strength after strong results from builder.

March 23, 2006: 6:16 AM EST


NEW YORK (CNNMoney.com) - Tech stocks could face rough going in early trading Thursday after an earnings and revenue warning from Adobe Systems, as other investors look ahead to the latest reading on real estate market strength.

U.S. stock futures were down, indicating a lower open for U.S. markets, with the tech-heavy Nasdaq futures especially weak.

Adobe (Research) issued earnings late Wednesday that topped forecasts, but the maker of graphics software said profit and revenue in the current period could fall short of forecasts. Shares of Adobe lost nearly 4 percent in after-hours trading and some other tech stocks were also lower.

At 10 a.m. ET the National Association of Realtors issues its report on February existing home sales. Economists surveyed by Briefing.com see sales slipping to an annual pace of 6.5 million, down from 6.6 million in January.

Builder KB Home (Research) reported better-than-expected earnings after the market close Wednesday and reaffirmed its guidance for 2006 results, which lifted the stock nearly 2 percent in after-market trading.

Oil prices rebounded after slipping Wednesday following the U.S. fuel inventory report. The May light crude futures contract for NYMEX gained 34 cents to $62.11 a barrel in electronic trading.

Major markets in Asia closed mixed Thursday, with Japan's Nikkei little changed. Major European markets also were mixed in early trading.

Treasury prices were higher, cutting the yield on the benchmark 10-year note at 4.69 percent from 4.70 percent late Thursday. The dollar was higher against the euro but lower against the yen.

In other corporate news, Dell (Research) announced plans to purchase boutique PC maker Alienware for undisclosed terms, a move that gives it better access to the high-end gaming PC market.

The Alienware deal allows Advanced Micro Devices (Research) to gain access to Dell, which has used only Intel (Research) chips in the past. Shares of AMD were up 2.5 percent in after-hours trading while Dell was little changed. Intel shares were up nearly 1 percent in Frankfurt trading Friday.