Apple stock traded up again today as traders relaxed over Fed plans for interest rates. Fed Chairman Alan Greenspan spent the morning in front of the Senate today in the 2nd half of his semiannual report to Congress. That session revealed little in the way of information regarding any imminent rate hikes in the interest rate, so traders relaxed and the tech sector benefited. According to a News.com article:
Stocks reversed early losses as Federal Reserve Chairman Alan Greenspan appeared before the Senate Banking Committee. The question-and-answer period after his testimony has yielded no new clues to whether the central bank is likely to raise interest rates.
"People were concerned that Greenspan would say something negative about interest rates, but he hasn't," said Todd Clark, managing director of listed trading at Schwab Capital Markets & Trading Group. Traders who sold stocks and stock-index futures late yesterday in a bet that Greenspan would rattle the markets are reversing those trades, he said.
Apple closed at 54 3/8, a gain of 11/16 or 1.28%. Volume was moderate with 2,932,800 shares trading hands.
Apple's PC competitors also fared well with IBM, Dell, Hewlett-Packard, Compaq, and Gateway 2000 all closing higher.
The Dow and the Nasdaq showed mixed results however with the Dow closing at 10972.07, a loss of 6.97 while the Nasdaq closed at 2705.84, up 26.51.
The Mac Observer Spin: This is simply an aside: Mr. Greenspan's report to the Senate was followed by a question session from the House Ways and Means and committee. During that session, Senators seemed to completely ignore the reality of Mr. Greenspan's report while seeking to get Mr. Greenspan to support their party's plan for current budget surpluses. It would have been quite amusing had the subject not been billions and billions of dollars of tax money.
Our take on his stance was that he would prefer to see the national debt paid down as much as possible and cited our current economic situation as a once-in-a-generation opportunity to do so. He rated tax cuts as a distant 2nd in a choice of lesser evils.
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