Technology stocks took a beating on Wall Street after Circuit City Stores Inc warned that sales of personal computers in its third quarter weakened dramatically, while sales of most consumer electronics products remained soft, making it clear that whoever in the retail sector had a happy Christmas this year, it is not going to be personal computer manufacturers and marketers. One big damper on the sector is the decision by Intel Corp to hold back Pentiums with the MMX extended multimedia instruction set until early 1997: every pundit writing for consumers about personal computers has been warning in ever more strident terms that those that buy a personal computer this Christmas are likely to regret it, and that the machine you buy in March will be cheaper and better. Our inventory control systems have enabled us to closely manage product supply, placing us in an excellent quarter-end position despite lower-than-anticipated sales, said Richard Sharp, Circuit City chairman and chief executive, who was hit by a whopping 10% decline in sales from stores open a year ago in its most recent quarter. The Nasdaq Composite Index with its rather more recent base, lost almost 2% of its value on Monday night, slumping 23.81 to 1,261 in late trading – equivalent to a 115 point fall in the Dow Jones Industrial Average. In fact the Dow was off only 36 at 6,268. Wally Raymond, vicepresident of sales at Laptop Superstores in Natick, Massachusetts told PC Week that sales have been fair to good, but not fantastic, and said pricing has been key in moving notebooks, a sentiment echoed in the desktop market, particularly as vendors slash prices. We have seen some customers come in with the ads from vendors, Tim Carney, service manager for G Blackstone Enterprises, a MicroAge Inc reseller in Carbondale, Illinois said. As far as name brands go, I see far more clones being sold because of the pricing.
