The Nasdaq ($COMPQ) fell more than 16 points, or 1.4 percent, to 1,170.61 with about three hours of trading left. The last time the tech-heavy index was so low was Sept. 12, 1996, when it fell to 1,165.81 in intraday action.

The index is also coming off a 26-point loss in the previous trading session.

A share of Cisco (CSCO) could be had for about the same price as a movie theater ticket as the networking leader lost 25 cents to trade at $9.80. The last time Cisco was so low was Jan. 26, 1998, when, adjusted for splits and dividends, it closed at $9.44.

Among other networking stocks, Juniper Networks (JNPR) was off 27 cents at $4.80 and Lucent Technologies (LU) shed 2 cents to fall to 77 cents.

Chip stocks bore a good piece of the sell-off burden after Wednesday's earnings and revenue warning from Applied Micro Devices (AMD) Share of AMD slid $1.49, or 28 percent, to $3.89. See full story.

Other chip stocks in the red included Intel (INTC) , down 25 cents at $14.05, Applied Materials (AMAT) , off 68 cents at $11.85, and Texas Instruments (TXN) , which gave up 44 cents to trade at $15.45.

The Philadelphia Semiconductor Index ($SOX) shed nearly 13 points to fall to 237.21.

Hardware stocks were largely up, with EMC (EMC) rising 16 cents to $5.04, Hewlett-Packard (HPQ) gaining 37 cents to reach $12.27, Sun Microsystems (SUNW) up 1 cent at $2.58, and Dell Computer (DELL) rising 19 cents to $25.51.

IBM (IBM) fell 14 cents to $59.49, and Apple Computer (AAPL) was breaking even at $14.17.

In the software sector, Veritas (VRTS) fell $2.50, or 17 percent, to $11.97, after CFO Ken Lonchar following revelations he lied about receiving an MBA from Stanford University. See full story.

Microsoft (MSFT) fell 57 cents to $45.03 and Siebel Systems (SEBL) was down 44 cents at $5.64.

Oracle (ORCL) rose 8 cents to $8.39, PeopleSoft (PSFT) was up 13 cents at $12.52 and SAP (SAP) rose 9 cents to $10.81.