The light at the end of the tunnel has begun to shine in the deer-eyed faces of many investors. Sentiment that maybe the current economic slowdown will end propelled stocks into a broad based rally, and tech stocks were more broad based than others. Apple and their soon to be consolidated box making competitors, followed the up trend, with Apple posting more than a 5% gain on very strong and convincing volume. According to Reuters story:
"We have companies saying that one quarter, maybe two, (will be bad) but a lot of people are thinking that eventually things will get better," said Donna Van Vlack of Brandywine Asset Management, which has $7 billion under management. "But we seem to have gotten to levels where it is safe to have a toe in the water and rebuild positions," she said.
CBS Marketwatch reports that many traders fell like all the bad news from the earnings warnings, which continue unabated, has been built in to current prices, and it is time to buy. According to CBS Marketwatch:
"A lot of the bad news is priced in and weire starting to focus on the fourth quarter and next year, when the economy [is expected] to recover. Weill continue to see earnings warnings but I think that weive bottomed on that front and have begun to turn," said Art Hogan, chief strategist at Jefferies & Co.
"Weire starting to get traction in the stock market. The Fed will continue to ease, though maybe less aggressively. But thatis a good thing, because itill mean the economy has improved," Hogan said.
This follows comments yesterday from both Merrill Lynch and Morgan Stanley Dean Witter that followed the same line. Neither the latest earnings warnings nor Vice President Dick Cheneyis trip to the hospital had any noticeable impact on todayis trading. Volume, while still slightly lower than normal, was much stronger today than yesterdayis anemic levels. The winter storm in the North East US likely impacted this today as it did yesterday. The Nasdaq was as much as 85 points higher today, though some profit taking took hold in the last hour of trading. The Dow also gave back some gains as the day wore on, but also closed in the black.
Apple was in the news as Bear Stearns analyst Andrew Neff once again showed his ineptitude when it comes to Apple. Mr. Neff implied that Apple had profited in December and was losing money now. In reality, Apple lost big money in December and is slated to make a small profit this quarter. That could change, of course, but Apple has not changed their guidance regarding the quarter. His comments were included in a story from Reuters about consolidation among the box-makers. Wall Street loves to hear about mergers, most of the time, and this may have had an influence on todayis trading.
Apple traded in positive territory all day, and had met their current average volume by 1:00 PM EST, with three hours of trading left to go. AAPL opened up in the black, never looking back, and traded in a narrow range through most of the day. The dayis full range was 20 11/16 - 22 1/16. Apple has tacked on more than 11% in the last two days of trading.
Apple closed at 21 1/2, a strong gain of 1 1/8 (+5.52%), on strong volume of 13,062,600 shares trading hands.
The Nasdaq closed at 2204.43, up 61.51 (+2.87%), on volume of 1,986,809,000 shares trading hands.
The Dow closed at 10591.22, up 28.92 (+0.27%), on volume of 1,096,735,000 shares trading hands.
The S&P 500 made it a family affair by closing at 1253.65, a gain of 12.24 (+0.99%).
Akamai was downgraded by Morgan Stanley Dean Witter from an Outperform to a Neutral rating. The analysts also lowered estimates for 2001, though Akamai has reaffirmed their guidance. Akamai has been hammered for a 37% devaluation in the last five days of trading. Ouch. AKAM closed at 12 9/16, a loss of 11/16 (-5.19%), on heavy volume of 5,782,800 shares trading hands. Apple is a large shareholder of Akamai.
Adobe closed at 28 1/2, a gain of 1 7/16 (+5.31%), on volume of 8,634,500 shares trading hands.
IBM closed up at 106, a gain of 1.09 (+1.04%), on volume of 8,118,900, on light volume of 6,743,900 shares trading hands.
Motorola closed higher at 17.70, a gain of 0.95 (+5.67%), on volume of 13,790,200 shares trading hands.
Earthlink closed at 9 15/16, a loss of 1/8 (-1.24%), on volume of 1,727,600 shares trading hands.
Gateway closed 16.97, up 0.90 (+5.60%), on volume of 3,623,600 shares trading hands.
Dell posted a very strong gain on general momentum. DELL closed at 26 3/16, a gain of 2 3/4 (+11.73%), on strong volume of 63,335,300 shares trading hands.
Hewlett Packard closed higher at 32.15, a gain of 1.77 (+5.83%), on volume of 6,976,000 shares trading hands.
Intel announced after the bell that they did not see chip demand increasing any time soon. The stock closed at 31 1/2, a gain of 1 1/8 (+3.70%), on strong volume of 59,576,900 shares trading hands.
Microsoft closed at 59 7/16, a gain of 2 (+3.48%), on volume of 33,383,700 shares trading hands.
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 updated Apple Stock Watch Special Report. You can also check out our Apple Financial Boards, a new moderated forum for Apple Investors and people who are interested in Appleis financial dealings.