Dell Drags the PC Stocks Lower, Including Apple

Itis no longer possible to say Appleis sales slow down is merely a Mac-related problem. Dellis warning confirmed the industry wide nature of the PC sales slowdown, instigating a broad tech stock sell-off. Appleis stock gave up yesterdayis gains and then some.

Dell set a new two-year low, falling 3 dollars to close at 25 3/16, after alerting investors that if sales trends continue through the next quarter the Austin, Texas company will grow revenue at 27% annual rate, instead the 30% or more expected by investors. Dellis stock is down 50% in the last six months, almost rivaling Appleis fateful 67% decline.

Next week the earnings announcement calendar begins to get busy, perhaps providing some good news to change the mood of the market. Of course, as long as chaos rules in the Middle East and Serbia, combined with the uncertainty of a close US Presidential race, a weak euro, and high oil prices, and a slowing economy, the stock market will have quite a wall of worry to climb.

Apple sank 1 9/16 or 6.61% to close at 22 1/16 on volume of 15 million shares. Thatis the lowest trading volume yet since last Thursday when Apple announced it will miss earnings when the company releases 4th quarter financial results on October 18th.

The Nasdaq fell 51 points (-1.46%) to close at 3471 on volume of 1.85 billion shares. Traders are calling todayis market action the sign of a short term bottom for a number of technical reasons, including an improving put-to call ratio and the exhaustion of investors willing to sell.

The Dow fell 60 points (-0.56%) to close at 10724 on volume of 1.1 billion shares.

The S&P 500 climbed 1.89 points (0.13%) to close at 1436.21.

In Apple related businesses: Akamai fell 5 3/4 to 39 3/4, another new low. Adobe suffered a second day of profit taking, down 9 1/2 to 148 1/2. Earthlink bounced off yesterdayis 52-week low by 9/32 to 8 5/16. Motorola lost 1 1/4 to 28 1/2. IBM shed 1 5/16 to 113 1/16.

Appleis competitors: Gateway was lower by 2.77 to 49.13. The PC company reiterated its comfort with its earnings for the quarter in an effort to diffuse the blast from Dellis miss. Gateway expects to announce earnings per share of $0.46 and revenues of $2.5 billion for the quarter on October 12th

A Reuters article pointed out that Compaq and HP, "both derive about one-third of their sales from Europe." In spite of the danger of a sales slow down or unfavorable exchange rates due to the weak euro, both companies have made recent statement claiming they will meet earnings forecasts. Other companies with earnings at risk include IBM and Sun Microsystems (SUNW). Compaq gave back 3.82 to 25.02. Hewlett Packard lost 7 7/16 to 88 3/16.

Shares of Microsoft lost 3/16 to 55 1/4. Intel fell a buck to 41 dollars.

In economic news: Tomorrowis US unemployment data for September will be watched a bit closer than usual since the Federal Reserve listed the tight labor market as one of the many inflationary pressures on the economy in recent comments. Most economists expect the unemployment rate to remain the same as in August at 4.1%, hovering just above 3.9%, the 30-year low set in the spring.

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 Appleis stock activity, visit our Apple Stock Watch Special Report.

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