Markets Brace for Possible Revenue Letdown From Dell

U.S. stock markets were braced for the possibility of selling pressure after the Presidents Day holiday if Dell Computer Corp. reports disappointing sales today.

“We could have a nasty week,” said Barry Hyman, senior market analyst at Ehrenkrantz King Nussbaum Inc. in New York. “Dell is important to the tech sector. Any shortfall or slowdown in growth is going to hurt this sector.”

Dell shares dropped 12% on Friday on concern that the No. 1 direct-seller of personal computers will report weaker-than-expected fourth-quarter sales. Dan Niles, an analyst with BancBoston Robertson Stephens, warned that sales will be $5.2 billion, short of his earlier forecast for $5.5 billion.

Hewlett-Packard Co. is also scheduled to report earnings today. Analysts forecast the world’s second-largest computer maker’s profit to decline to 83 cents a share for the quarter ended Jan. 31, down from 86 cents in the 1997 quarter.

Computer-related shares are at high values, said Art Micheletti, chief investment strategist at Bailard, Biehl & Kaiser of Fosters City, Calif. “So when you get a decline, that’s where you get hurt the most.”