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February 22nd, 2000

[4:00 PM] Apple Stock Watch: Stock Market Train Wreck Upsets The Apple Cart Too
by Wes George

Friday's sell off continued today as a widespread decline in technology stocks. Apple dipped way down before Maria Bartolomo broke the news on CNBC that Merill Lynch believes Apple will show excellent growth in the current quarter and possibly has a true "Internet Appliance" in the works.

Later, Reuters reported that, "Merrill Lynch analyst Steve Fortuna said that he had a "very upbeat" meeting with Apple executives. Fortuna said that Apple is comfortable with earnings per share in the range of $0.80 for the March quarter and that the company is looking for unit growth for the year of about 40 percent, compared with his estimates of 35-37 percent unit growth. He also said that Apple believes it can grow revenues in fiscal 2000 by 35-36 percent, slightly above his forecast."

Moreover, Fortuna believes that Apple has plans to extend its Internet service to Europe and Japan while possibly adding a new Internet appliance to the Mac hardware line.

Apple gained 2 9/16 or 2.30% to close at 113 13/16 on 3.7 million shares traded. Apple dipped as low as 106 dollars intraday before come back strong.

The stock markets were highly volatile today. According to the Wall Street Journal, "Investors were rattled by hawkish remarks made early Tuesday by William McDonough, president of the Federal Reserve Bank of New York. 'It's very clear that we will have to use the interest-rate tool as long as the demand side of the economy stays this robust.' he said, in a speech to a group of business leaders in New York."

The Nasdaq lost 31 points (0.71%) after slipping more than 100 points in the morning, to close at 4380 with volume at 1.7 billion shares traded.

The Dow gained 85 points (0.83%), in more than a 200 point trading range, to close at 10304 with volume at 976 million. Bargain hunters' strong buying pushed up many beaten down blue chips.

The S&P 500 gained 5.88 (0.44%) to close at 1351.

In Apple related businesses: Adobe was up fractional to close at 98 9/32. Akamai gained 7/16 to close at 242 1/8. ARM Holdings lost 16 5/8 to close at 194 dollars. . IBM lost 1 3/8 to close at 111 1/8 dollars. Shares of Earthlink (ELNK) gained about 2 dollars to close at 21 3/4. Macromedia gained 1 1/8 to 71 3/4.

Motorola soared 11 15/16 to close at 156 7/8 as investors bet that Motorola will profit from easy access to the web via cellphones.

Apple's competitors: Compaq lost 7/16 to close at 24 13/16. Intel gained 1 3/8 to close at 106 3/4. Gateway gained 11/16 to 57 3/16. Dell lost 1/4 to 39 13/16. Hewlett Packard lost 7/8 to close at 128 1/8. Shares of Microsoft slid 1 1/4 to close down at 93 13/16 dollars.

The bellwether 30-year US Treasury bond traded up 29/32 to 102 8/32 as investors fled the stock market for the safety of bonds. The yield, which moves inversely to the price, dropped to 6.09% from last week's 6.16%.

In the week ahead: US Federal Reserve chairman, Alan Greenspan, will continue his Humphry-Hawkins testimony before Congress tomorrow morning. Expect the market to hang on every word.

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 many of 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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