Downbeat corporate news has pushed the iconic Nasdaq index of hi-tech stocks to its weakest close in six years.

The Nasdaq settled down 1.83% at 1,165 on Thursday, its lowest close since 12 September 1996.

The latest decline came as investors digested news that semiconductor giant Advanced Micro Devices (AMD) expects to undershoot its sales targets for the July to September period by as much as 18%.

AMD shares lost a third of their value on Thursday, and dragged other heavyweight Nasdaq stocks - including chip industry leader Intel - lower in sympathy.

The combined value of Nasdaq-listed firms has now fallen by 43% since the beginning of the year, and by more than 76% since the index hit its peak in March 2000.

Out of favour

The market's fortunes have waxed and waned in line with investors' short-lived love affair with technology stocks.

The Nasdaq enjoyed its heyday during the boom of the late 1990s, when it came to be seen as a symbol of the 'new economy' - the much-vaunted economic paradigm which promised sustained growth thanks to technology-led increases in productivity.

The index became home to a raft of technology, telecommunication and biotechnology stocks which attracted investors in their droves.

The Nasdaq soared by 77% in 1999 alone, finally peaking at about 5,000 in March 2000.

Decline and fall

Its sharp decline since then has mirrored investors' growing conviction that the much-vaunted new economy may have been founded on little more than hype.

However, Nasdaq-listed firms include many highly respected, financially sound companies, many of them among the best-known names in their field.

Other hi-tech stock indexes have had an even more traumatic time of it.

Earlier this month, the German stock exchange operator announced that the Neuer Markt, often seen as Europe's answer to the Nasdaq, was to close after losing 96% of its value over the last two years.