Apple Climbs Higher Ahead Of Q3 Earnings Report Tomorrow

The earnings hit parade continued to drive the Nasdaq higher today. However, volume was light and the Dow drifted lower while many investors sat on the sidelines ahead of this weekis economic data reports. Appleis stock continued to trend higher.

Tomorrow after the bell Apple reports earnings. Analysts expect our favorite computer company to meet or beat earnings expectations of $0.44 per share and to report higher gross margins. The Mac Observer will have a preview of Appleis earnings tomorrow morning, followed by a report after the conference call.

Intel (INTC) and Microsoft (MSFT) also announce earnings tomorrow, followed by IBM on Wednesday and Sun Microsystems (SUN) on Thursday among others.

In economic news: The Commerce Department reported business inventories grew 0.8% in May, even while business sales shot higher in May by 1.0%, after a decline of 0.6% in April. The Wall Street Journal reported, "The biggest inventory gains were posted by retailers, suggesting they may have been overly optimistic about the pace of sales when ordering for the early summer period. Retailers boosted inventories by 1.4% to $382.3 billion, the biggest increase since January 1995. That followed a 0.3% gain in April."

The Consumer Price Index (CPI) released tomorrow morning could shed some light on whether inflation is creeping higher, although it will be skewed higher because of the anomalously high fuel prices.

Apple rose 5/8 to close at 58 5/16 on volume of 4.6 million shares. There is plenty of news about Apple out there today as the pre-MACWORLD anticipation runs high. Other articles focus on tomorrowis earnings announcement.

The Nasdaq gained 28 points (0.67%) to close at 4274 on volume of 1.5 billion shares

The Dow declined 8 points (-0.08%) to close at 10804 on volume of 904 million shares. Both the Dow and the S&P showed some late day weakness.

The S&P 500 climbed 0.51 points (0.03%) to close at 1510.49. The S&P is now within striking range of its all time high set March 24 at 1527.

In Apple related businesses: Akamai lost 1 5/16 to 124 11/16. Adobe traded down 1 1/8 to 135 1/16. Earthlink soared 1 1/2 to 17 5/16. Motorola gained 1/2 to 38 5/8.

IBM climbed 1 9/16 to 105 1/2. On Wednesday IBM is expected to report second-quarter earnings of $1.00 per share, a $0.09 gain over last year at this time.

Appleis competitors: Hewlett Packard gained a dollar to close at 134 13/64. Gateway was down 1 5/16 to close at 65 1/16. Compaq fell 1/16 to close at 27 13/16. Dell climbed 1/2 to 53 9/16.

Shares of Microsoft were off by 3/4 at 78 3/16. The software giant is expected to announce earnings about $2.4 billion, or $0.42 cents a share, on revenue of $5.8 billion for the last quarter. CNET News reported, "While most analysts expect Microsoft to meet or slightly exceed those estimates, many say the Redmond, Wash.-based software maker is facing the same challenge as rivals Computer Associates International and BMC Software. The companies are trying to boost sales though businesses are slowing software purchases."

Intel lost 3/8 to 146 5/16. While Intel is expected to beat earnings tomorrow, a debate among analysts is raging over whether or not the chip sector has peaked for the year. Also, Intelis earnings will be skewed upward by a one time gain of $2.3 billion from the sale of investments which could push the EPS higher by as much as $0.30 per share then is otherwise warranted by Intelis earnings alone.

The Mac Observer Stock Watch Virtual Portfolio continues to move more securely into the black. :->)

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 Apple Stock Watch Special Report.

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