[4:00 PM] Apple Stock Watch: Apple Moves Past Gateway
by Wes George
Apple may have surpassed Gateway in US PC market share, according to IDC. Meanwhile, Stocks opened higher today buoyed by strong earnings in the tech sector, but later the stock markets turned on a dime and fell into a chasm of profit taking.
According to Reuters, Mexico's Sanborns will acquire CompUSA (CPU) in a tender offer worth $10.10 per share, while Telefonos de Mexico (TMX), Microsoft and SBC Communications Inc. (SBC) will be minority investors in the company. Sanborn will pay $320-$330 million to increase its stake in Dallas-based computer retailer to 51 percent. There is no news yet how or if the buy out will have any effect on Apple's marketing agreements with CompUSA.
Apple slipped 5 1/16 or 4.55% to close at 106 1/4 in light trading volume of 3.9 million shares traded.
International Data Corp. (IDC) and Dataquest released last year's PC vendor market share data today. Apple did well, as reported by cnet.com: "The company was ranked seventh worldwide for the year, according to Dataquest, inching up in market share to 3.4 percent. In the United States, Apple came in sixth for the year; despite 17 percent growth, its domestic market share slipped slightly from 4.6 percent to 4.4 percent."
The cnet.com article noted, "Dataquest's numbers show Apple behind Gateway in the year-end calculations, but IDC's data shows Apple edging Gateway out in the last quarter. Apple followed Gateway in both year-end calculations from Dataquest, but IDC's Brown pointed out that Apple edged out Gateway in fourth-quarter comparisons. 'Worldwide they passed Gateway by a tad," Brown said. 'They do have an opportunity to move up in the (rankings) for the first time in a long time.' "
A Reuters' article contained more details about Apple, "NEC's strength in European and Asian markets helped it retain its No. 5 spot, despite a 3 percent drop in year-to-year growth, ahead of fast-gaining No. 6 Apple which regained its status among top PC makers worldwide amid surging consumer sales, Dataquest said."
The Nasdaq gave back 139 points (3.29%) to close at 4095 with 1.97 billion shared traded making today the heaviest volume day ever on the Nasdaq. There was no real news to explain the decline outside of a busy week ahead full of inflation specific market data and comments from the Fed later this week.
The Dow lost 243 points (2.16%) to close at 11008, on very heavy volume of 1.1 billion shares traded. Today was the 3rd largest point drop in Dow history, while the Dow traded in a 450 point range.
The S&P 500 lost 39.82 points (2.76%) to close at 1401.54.
The bellwether 30-year US Treasury bond gained 18/32 to 93 6/32 sending the yield south to 6.65% from 6.71% on Friday.
Mr. Greenspan will testify Tuesday before the Senate Banking Committee, while the Federal Reserve will meet on Feb. 1-2 to determine whether to raise interest rates. The stock market, which expects a .25% increase from the Fed, will be watching closely.
On Thursday, the employment cost index data, rumored to be a favorite inflation strength indicator of Alan Greenspan's, are released.
In Apple related businesses, Adobe lost 2 5/16 to close at 60 9/16. Akamai gave back 7 dollars to close at 262, while ARM Holdings shed 3 1/2 dollars to close at 160 1/2. Earthlink, Apple's new Internet partner, traded down 3/4 to 45 5/8.
Oracle close down 5 1/2 to 54 3/16 after the stock split 2 for 1.
Apple's Power PC partners: IBM lost 3 7/16 to close at 118 1/16. Motorola sunk 4 15/16 to close at 139 7/16.
Apple's competitors: Dell is expected to have difficulty meeting the analysts' consensus of $0.21 a share for the January quarter. Today, a number of analysts chimed in their concerns about top line and gross margin weakness over the near term for the boxmaker. Dell slid 2 3/16 to close at 41 9/16.
Compaq beat the trend, surging 1 5/16 to close at 32 9/16 on news of an upgrade from Donaldson Lufkin and Jenrette analyst Kevin McCarthy, who raised his rating on Compaq to "buy" from "market "perform. Robert Stephenson said they see an unusually strong year shaping up for Intel due to high demand for their semiconductor products. Intel share climbed 7/8 to close at 98 13/16.
Shares of Microsoft slumped 2 1/2 to close at 101 1/4. Gateway lost 2 1/8 to end at 59 7/8. Hewlett Packard gained 7/8 to close at 114.
CBS MarketWatch covered the PC marketshare data release too, "Worldwide unit shipments of PCs increased 19 percent in the fourth quarter from year-ago numbers, IDC reported. But that's off from average growth of 24 percent for the first three quarters of 1999. Shipments in the United States increased 17 percent over the year-ago quarter but only 5 percent from the third quarter."
In other market news: The US Treasury Secretary, Lawrence Summers, lectured Europe and Japan at the Saturday meeting of the Group of Seven, warning they should emulate US style business investment and entrepreneurship in their own countries if they wish to prosper.
The Wall Street Journal reported, "While they might not agree with those precise prescriptions, European and Japanese officials generally sympathized with the argument that technological innovation could eventually allow their economies to grow faster than 1% or 2% a year. "It is necessary that consumption recover first," Japanese Finance Minister Kiichi Miyazawa said."
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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