In a postclose conference call, Cisco's CEO John Chambers said "We saw dramatic decreases year over year in orders from financial services" as well as softness in the automotive market. This means that the company is beginning to feel the impact of credit crunch in the U.S. After the earnings announcment, Cisco's shares have fallen to below $29 after hitting 52-week high of $34 last week. Run-up of the tech-heavy Nasdaq Composite Index has also ended. On Friday, it closed at 2628 points, 8% off the 52-week high of 2862 reached on October 31st. The tech sector was thought to be a safe haven among many investors- but disappointing guidance from Cisco and the looming impact of credit crunch on tech spending have brought down investor sentiment.
Bottom line: U.S. industries such as retail, manufacturing, and financial services have begun to cut tech orders
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