[4:30 PM] Apple Stock Watch: Wall Street Cowers & AAPL Sags
by Wes George
Wall Street's catch-22 predicament began to take its toll today. Proctor and Gamble warned that among its many problems the slowing economy is going to cut into their earnings. Meanwhile, the Federal Reserve doesn't think the economy is slowing fast enough and could raise interest rates once again on June 28th. Stock prices caught between further interest rate hikes and/or a slowing economy had no where to go but down. Apple's stock shed almost two dollars as our nervous summer rally stumbled.
The European Central Bank raised short-term interest rates Thursday by 50 basis points to the surprise of most continental observers who thought the ECB would raise rates by only a quarter point to come in line with US rates. ECB President Wim Duisenberg said the bank is fighting inflation not attempting to boost the sagging Euro against the US dollar.
The most recent sign of a US economic slowdown came from the Labor Department, which reported that the latest weekly claims for unemployment benefits hit their high for the year. But most on Wall Street view the number as too volatile to trade on and await tomorrow's producer price index (PPI) report for a reliable reading of inflation at the wholesale level.
Obviously, a weaker-than-expected PPI (it's forecast to gain 0.2%) will signal the continuation of our summer rally, while stronger-than-expected data will hail rising inflationary pressures, more interest rate hikes by the Fed and a general market reversal going into next week.
Apple declined by 1 3/4 or -1.81%, to close at 94 13/16 on volume of 2.1 million shares trading hands, well below AAPL's average daily volume of 3.8 million shares.
The Nasdaq shed 13 points to closed near the day's low at 3825 on volume of 1.3 billion shares traded. But we should put things in perspective, the Nasdaq is up 26% from the end of May. The Philadelphia Semiconductor Index (SOX) is up 38% since its low on May 24. Those are pretty good numbers for what seems like a tame, low volume tech rally with little momentum.
The Dow fell 142 points (-1.32%) to close at 10735 on volume of 846 million shares.
The S&P 500 sagged 9.68 points (-0.66%) to close at 1461.68.
The Mac Observer Stock Watch Virtual Portfolio had a weak day along the general softness on the Nasdaq.
In Apple related businesses: Akamai gained back 5 1/16 to close at 90 9/16. ARM Holdings lost 1 1/16 to close at 32 dollars. Adobe rose 4 1/16 to close at 118 3/8. Earthlink fell 3/8 to close at 17 9/16. Macromedia climbed 5/8 to 99 15/16. IBM gave back 1 7/16 after yesterday's 8 dollar gain to close at 119 9/16. Motorola lost 1 5/8 to close at 36 bucks.
Apple's competitors: Hewlett Packard climbed 3 5/8 to close at 126 3/16. Gateway climbed 1 3/4 to close at 56 1/4. Compaq lost 5/16 to close at 26 13/16. Intel lost 2 9/16 to close at 126 3/8.
Microsoft filed for a stay of US District Judge Thomas Penfield Jackson's final ruling issued yesterday. According to the Wall Street Journal, "Microsoft's request for an immediate stay of Judge Jackson's order includes the business restrictions the judge placed on the company. Judge Jackson hasn't ruled on the request, but is expected to refuse it. Microsoft would then be free to ask for a stay from an appeals court, which would be more likely to grant it." Microsoft lost 1 11/16 to close at 68 13/16.
For full quotes on all the companies mentioned in this article, we have assembled this set of quotes at Yahoo! for your reference. We also have many of these same quotes reported live (20 minute delay) on our home page. For other stories regarding Apple's stock activity, visit our Apple Stock Watch Special Report.
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