Best Buy's most-difficult-climate-ever announcement is rippling through the markets, bringing down tech shares as its own stock price plunged 8% Wednesday. Adding to the gloom, research firm IDC said global tech spending will slow down next year in the economic turmoil.
Best Buy dramatically scaled back its earnings outlook for the next year, saying that "rapid, seismic changes in consumer behavior" have created the worst retail environment in its history. Other electronics retailers are in similar straits, with Circuit City declaring bankruptcy to get through the crisis.
That's causing some concerns about electronic supply chain stocks, particularly the ones with high consumer exposure. Molex, Nam Tai and Tyco Electronics are susceptible to estimate reductions and other challenges in the coming quarters, according to analysts at Collins Stewart. Of these, Nam Tai could be most at risk.
The Best Buy announcement could also be a negative for Corning and AU Optronics, which have LCD products in televisions, notebooks, computer monitors and other electronics, the analysts said.
All of those companies are taking a hit in the markets. Here's where they were trading just before Wednesday's close:
AU Optronics: Down nearly 6% to $5.95
Corning: Down 8% to $9.16
Molex: Down 7% to $11.90
Nam Tai: Down 4% to $6.01
Tyco: Down 7% to $13.11
Best Buy shares have fallen 8% today to $21.97.
Related reading:
Can Circuit City survive bankruptcy?
Best Buy, tax rebates aside, still faces trouble
HDTV shoppers tune out Best Buy
Spending on gadgets slows down
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