By Caroline Valetkevitch
NEW YORK (Reuters) - The Nasdaq fell on Wednesday after a weaker-than-expected target from Texas Instruments
Rising oil prices dragged on the broader market on the two-year anniversary of stocks' bull run from the S&P 500's 12-1/2-year closing low of 676.53, which was sparked by the financial crisis.
An index of semiconductor shares <.SOX> was down 2.9 percent and was trading below its 50-day moving average in another sign of more losses for the sector.
Texas Instruments shares fell 3.1 percent to $34.74, a day after the company gave a current-quarter earnings estimate below Wall Street's estimates.
"I think the markets are ready for a sell-off that continues to be started by the Nasdaq futures markets," said Harry Michas, technical analyst and stock index futures trader at Iharmarketmonitor.com.
"If the Nasdaq futures fall back below the 2,313.00 level again, it should attract more profit taking as well as some new shorts." The futures were trading around 2,316.
Bucking the tech trend, the Dow bounced back from a session low and reclaimed a slim gain as buyers snapped up shares of International Business Machines Corp
The stock hit an intraday high of $167.72, its highest since 1973, after a host of analysts raised their target price on the stock. A day earlier, the tech giant reaffirmed its 2015 earnings target.
Even though semis' gains have outpaced the broader market in the last several months, the S&P 500 and the semiconductor index have been moving in the same direction, which could mean further declines in the sector and spell more of the same for the overall market.
A 20-day correlation between the S&P 500 and the semiconductor index <.SOX> was at 0.77, with a reading of 1 suggesting a perfect correlation.
The Dow Jones industrial average <.DJI> was up 11.16 points, or 0.09 percent, at 12,225.54. The Standard & Poor's 500 Index <.SPX> was down 1.33 points, or 0.10 percent, at 1,320.49. The Nasdaq Composite Index <.IXIC> was down 14.57 points, or 0.53 percent, at 2,751.20.
The semiconductor index is up 41 percent since the start of September, when the recent rally began, while the S&P 500 is up 26 percent.
Tech shares also felt the weight of Finisar Corp
Finisar is up 100 percent since the start of September, when the recent stock market rally began.
IBM's stock was last up 2.4 percent at $166.08.
"The stock is going against tech in general this past week," said Michael Quigley, tech analyst at Wedgewood Partners in St. Louis. "It is a great business, and we always have our eye on it."
In the oil market, Brent crude gained $2.57 to $115.63 a barrel as turmoil in Libya continued. The higher prices reinforced worries that high energy costs could dampen economic growth.
Libyan forces loyal to Muammar Gaddafi surrounded rebels in the western city of Zawiyah with tanks and snipers in the main square, witnesses said.
Adding to concerns about the global economy, the Portuguese government's two-year cost of borrowing hit the highest level since it joined the euro in a bond auction on Wednesday, and an official said yields were unsustainable in the long run without Europe-wide action.
(Reporting by Caroline Valetkevitch; Additional reporting by Doris Frankel and Ryan Vlastelica; Editing by Jan Paschal)
