Tech Stock Sell Off Drives NASDAQ Down

Monday Morning Activity

The markets dropped almost from the opening bell as the fallout from the WorldCom accounting disaster grabbed new headlines. After a three-day suspension of trading, WorldCom dropped about ninety three percent in value to about $.06 per share as more than one billion shares of the troubled company changed hands.

WorldComis chairman announced that the probe of accounting irregularities has widened and the markets now expect the formerly fast-growing telecom giant to face bankruptcy as the company has more than $30 billion in debt and only a fraction of that amount in cash and equivalents.

In afternoon trading the NASDAQ Composite Index was down more than four percent on the WorldCom news and concerns about the prospects for biotech and tech stocks as the third calendar quarter officially begins.

Monday Market Close

At the close of trading on Monday the Dow Jones Industrial Average stood at 9,109.93, down 133.33. The S&P 500 was off 21.16 at 968.65. The NASDAQ Composite Index closed down 59.38 at 1,403.83. Apple closed down $.66 at $17.06, in sympathy with the broader NASDAQ market.

Apple Acquires Emagic

On Monday Apple Computer announced the acquisition of Emagic, a Germany-based maker of computer audio products. According to the press release, Emagic will continue operations as a wholly owned division of Apple Computer.

Apple has announced that sales of Emagicis Windows-based products will be discontinued as of September 30, 2002. Macintosh sales currently account for about sixty five percent of Emagicis revenues. The acquisition of Emagic is the latest in a string of purchases by Apple to enhance its product offerings, bolster the strength of the companyis technologies and increase its patent portfolio.

Executive Stock Sales

Observer Tom Musumeci sent a long a link to an AP story picked up by the Washington Post . The story details concerns about the timing of stock sales by Apple executives in the weeks before the recent revenue and earnings warning. Prior to two of the three most recent earnings warnings, Apple executives sold shares ahead of the news.

While the sales of shares by Apple executives may have more to do with the timetable for the vesting of options, personal decisions by executives to make use of their options for any number of reasons or general sentiment among executives about the challenging economic environment faced by all PC makers, the timing of the sales has promoted media interest. Please join the discussion on this issue and all matters relating to Appleis finances in the newly revised Apple Finance Board forum.

Check out the new and vastly improved Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Appleis financial dealings!

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

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