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An Excellent Week for Apple's Stock

Apple Stock Watch: - An Excellent Week for Apple's Stock

by , 5:20 PM EDT, August 18th, 2000

Today was a quiet Friday in August ahead of the last week of summer and next Tuesday's Fed meeting to determine the future direction of interest rates. Apple's stock gave back some of this week's gains, but held at $50. AAPL's trend looks healthy.

Apple sank 1 7/16 or -2.79 to close at $50 on volume of 3.3 million shares.

AAPL started the week down about 10% year-to-date and ended today about even. AAPL's chart has started a new leg up, breaking through the 200-day moving average yesterday with volume trending higher. The stock's price is still, relative to its recent past performance, at the low end of its valuation spectrum.

Yesterday, a small article at Macworld Online reported that, "CFO Fred Anderson is confident that the company will report 35 per cent revenue growth – rising from $6 to $8 billion – in its results for the financial year 2000, which ends September 30."

Macworld Online reported that Andy Neff of Bear Sterns noted that the next potential product launch dates for Apple are at Seybold and the Apple Expo in Paris during September.

Apple Insider ran a story reporting that the Apple Store may be misleading customers with delivery dates the company can not meet for the new multiprocessor G4s, perhaps in a futile effort to meet Tim Cook's (Apple's VP of Operations) stringent shipping goals if only on paper.

The Nasdaq fell 9 points to close at 3931 on volume of 1.4 billion shares. The week belonged to semiconductor stocks ($SOX), which rallied every day this week for a 19% gain in the last five session.

The Dow retreated 8 points to close at 11047 on anemic volume of 817 million shares. Drugs, financial, and oil stocks were all weaker today.

The S&P 500 dropped 4.28 points to close at 1491.70.

In Apple related businesses: Adobe fell 2 5/16 to 122 9/16. Earthlink climb 1/16 to 9 11/16. Motorola shed 1/16 to 36 5/8. IBM lost 2 3/16 to 120 5/16.

Akamai gained 3 13/16 to 78 15/16. Technically, Akamai (AKAM) is building a double bottom chart with huge upside potential. Akamai is down about 80% year to date.

Apple's competitors: Dell lost 3/8 to 38 3/4. Compaq gained 3/16 to 33 3/4. Shares of Intel climbed 1/2 to 70 9/16. Hewlett Packard jumped 4 1/8 to 113 after posting strong earnings earlier this week.

Sun Microsystems (SUNW) announced a 2 for 1 stock split and surged 2 15/16 to 122 3/8, a new 52-week high.

Microsoft drifted lower by 9/16 to 71 dollars. A TheStreet.com article noted:

"Uncertainty over the outcome of Microsoft's scrum with the Justice Department has sent the stock down more than 39% for the year as of Wednesday's close. Since the start of the year, the percentage of large-cap growth funds holding Mister Softee's shares is a still-high 80%, but down from 88%. Recent regulatory filings from leading growth shops Janus and Fidelity indicate that many of their managers were selling Microsoft shares in the second quarter. "

In comparison, TheStreet.com had earlier reported, "On June 30, a higher percentage of U.S. stock funds owned shares of Dell, Compaq Computer, Sun Microsystems, Apple Computer and Gateway than at the start of the year. The only major PC shop that lost some of its fund following was IBM, and the biggest jump was in Sun Microsystems -- the strongest performer this year among these big-cap competitors."

The article reported the percentage of US stock funds holding shares in Apple on June 30th had increased to 13.0% from 11.2% at the beginning of 2000, while the percentage of technology funds with an Apple investment had climbed to 26.8% from 17.9% this year.

In economic news: The US trade deficit climbed to a record $30.62 billion driven higher by oil imports.

The Wall Street Journal analyzed:

"Economists for Thomson Global Markets had estimated a deficit of $31.4 million in June. The smaller-than-expected gap may cheer financial markets, as it suggests a pause in the recent trend of increasing reliance on foreign capital by the U.S. While the Federal Reserve is expected to leave interest rates unchanged at its meeting next week, monetary policy makers have shown increasing concern over the trade gap in recent months."

The FOMC has historically left interest rates alone during the sensitive US Presidential election period to avoid the appearance of partisanship. Many observers believe we have seen the last rate hike until at least spring of 2001.

The Mac Observer Stock Watch Virtual Portfolio Next week we are considering taking positions in shares in Pixar (PIXR) and Earthlink (ELNK), two good companies down on their stock market luck.

For full quotes on all the companies mentioned in this article, we have assembled this set of quotes at Yahoo! for your reference. For other stories regarding Apple's stock activity, visit our Apple Stock Watch Special Report.

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