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October 12th, 1999

[3:45 PM] Apple Stock Watch: Wall Street Gets the Jitters but Apple Trends Up
by Wes George

Apple bucked the trend on Wall Street today surging over 3 points before noon for an intraday high of $70 before settling back to close at $67.11/16 up $1 on a second day of strong momentum. Savvy investors are buying but few are selling on the day before Apple announces forth quarter earnings

The Dow suffered a sell off at the opening, and just kept going, closing down 231 to 10417 on low volume. Selling restrictions went into effect late in the day. The news today included fears of higher interest rates due to an expected spike in inflation. The dollar was soft in Europe. A coup in Pakistan, an unstable nuclear power, also added uncertainty to all of the world's markets today.

Third quarter earnings growth is strong at 20%, but most believe that this is already factored into the market and may feed into a decision by the Fed to hike rates in November.

A major defense contractor Raytheon's (RTNb) stock price closed down 19% today dragging a number of Dow components with them, accentuating an already bad day for the market.

The Nasdaq Composite index dropped 43.5 to close at 2872.45 due, in part, to profit taking after yesterday's record high for the Nasdaq. Internet stocks were strongly down as a group.

Motorola--the world's third largest semiconductor manufacturer-- will announce third quarter earnings after the market close today. Analysts expect the producer of the G4 coprocessor to post a profit of 53 cents per share. The whisper number is 56 cents per share. Investors are watching closely to see how the Iridium bankruptcy in which Motorola holds an 18 percent stake will effect earnings. However, most investors expect Motorola to beat estimates due to strong digital handset sales.

Most Apple related stock trended down sharply today with the market. This included Adobe, Symantec, and Macromedia, as well as Apple's AIM partners, IBM and Motorola. On the PC front, Dell, Microsoft, Gateway, and Hewlett-Packard all closed lower. Intel and Compaq.

Tomorrow is a big day for Apple. At 2 p.m. (PDT) Apple will announce fourth quarter results in a conference call with Fred Anderson. Apple has already announced earnings to analysts who follow the stock. This may explain AAPL's surge against the general down trend of the market this week as institutional investors buy ahead of the earnings announcement tomorrow.

For full quotes on all the companies mentioned in this article, we have assembled this set of quotes at Yahoo! for your reference. We also have these same quotes reported live (20 minute delay) on our home page. For other stories regarding Apple's stock activity, visit our Apple Stock Watch Special Report.


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