Steve Jobs’ Keynote Falls on Wall Street’s Deaf Ear

Not a good day on Wall Street, as the profit taking dug deep. Appleis stock ended counter-intuitively lower. Investors cluelessly shrugged off the news from MACWORLD which will radically alter the bottom line for Apple in coming quarters.

Mr. Jobs announced refreshed product families that account for 75% of the companyis unit volume and a fifth element -- the Power Mac G4 Cube -- was added to the Macintosh four quadrant hardware strategy. Did we mention two new models of G4s, the first ever PC to come standard with dual processors?

Not to mention a new optically tracking mouse, a more functional keyboard, three new displays and an entirely revamped iMac family.

Steve Jobs delivered the most inspirational keynote address in recent memory. But Wall Street hardly noticed, which puts those who witnessed Mr.Jobsi keynote in possession of what amounts to a hot stock tip! Apple is not only back, but the girls and boys in Cupertino have been working overtime revamping and expanding Appleis product line.

Appleis new hardware designs are not only stunting, theyire designed to produce maximum revenue flows while breaking out in front the competition. In fact, with the onslaught of insanely great new product announcements, one might be tempted to ask: What competition?

Itis the biggest product revamp in years. Or as one testimonial in Appleis G4 Cube promotional video shown during the keynote exclaimed, "Holy shit, theyive done it again!"

Product pricing also underwent a paradigm shift today. Mr. Jobsi introduced a $799 entry level iMac, and a 400MHz iMac DVD with firewire and 64 MB SDRAM for $999. The new dual-processor G4s are the same price as the older single processor versions. The G4 Cube is about $1800.

Steve Jobs, commenting about Appleis new aggressive pricing policy, told CNBC, "We want to be very aggressive", and about Appleis business plans, he said, "We are ready to take things to the next stage."

Steve also reassured Rene San Miguel of CNBC that Apple doesnit have any problem with component supplies and that many of the new products announced today are available at Appleis online store for sale now.

See the Mac Observer full article for a complete list of all the new products, deals and upgrades announced in the keynote address.

Apple sank 4 9/16 to close at 52 11/16 on volume of 8.1 million shares. But itis nothing personal, the Nasdaq was a sea of red today. Itis an old fashioned "buy the rumor, sell the news" type of week on the Nasdaq. The recent trend for stocks announcing earnings has been to sell-off, even when they beat expectations.

CBS Market Watch blamed AAPLis slide on the fact that third quarteris "sales total failed to match analystsi scaled-back expectations." See the Mac Observeris coverage of yesterdayis earnings announcement and conference call.

A number of analysts made comments about Apple. Donaldson Lufkin and Jenrette recommend a "buy on weakness" rating -- that would be today. DLJ maintains an $88 price target for AAPL. Pain Webber remains neutral. S. G. Cowen commented before the keynote that, "MACWORLD is crucial". Merrill Lynch has an "accumulate" rating on the stock.

The Nasdaq fell 120 points (-2.89%) to closed at 4056 on volume of 1.4 billion shares. The index is now down more than 200 points in the last two days and back in the red for the year-to-date by 15 points.

The Dow fell 43 points (-0.41%) to close at 10696 on volume of 905 million shares.

The S&P 500 dropped 11.75 points (-0.79%) to close at 1481.99.

In Apple related businesses: Akamai slid a dollar to 121. Adobe fell 15/16 to 130 dollars. Earthlink fell 13/16 to 15 3/4. Motorola dumped 7/8 to 36 5/8.

IBM climbed 3/8 to 103 11/16. After the bell IBM announced earnings of $1.06 per share, up from last yearis $0.91 and beating estimates of $1.00. Total revenues were down 1%. Hardware revenues were down 5%. Global services revenue were $8.2 billion, up 2%. European revenues came in at $5.9 billion, down 9%.

Appleis competitors: Hewlett Packard lost 1 3/16 to close at 129 13/16. Gateway was higher by 1/8 to close at 63 5/8. Compaq gave back 7/8 to close at 27 1/2.

Shares of Microsoft dived 5 3/8 to 73 1/8, after the company announced earnings of $0.44 beating estimates of $0.42. Intel fell 4 7/8 to x 138 1/8. Yesterday, the semiconductor giant reported earnings of $0.50 a share, post split, beating estimates by a penny.

In economic news: The US trade deficit climbed to a record $31.04 billion in May. However, even as the trade gap continues to widen, exports and imports actually declined for a second month.

Tomorrow, Federal Reserve Chairman Alan Greenspan will be closely followed as he delivers a speech before the Senate Banking Committee on monetary policy.

Yesterday, the consumer price index (CPI), a measure of inflation at the retail level, rose a greater-than-expected 0.6% in June helped along by the strongest rise in energy prices in 14 months. Consumer prices were up 3.7% year over year in June matching a nine-year high reached in March.

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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