Despite summer doldrums and facing the aftermath of the most widespread
blackout in U.S. history, tech stocks were active last week. The Nasdaq
Composite Index hit a new 16-month high, led by a buying rush in semiconductor
issues. "Chip stocks are really the building blocks for a host of products so
when you see them powering ahead it suggests that things are picking up for
the technology industry overall," said Stephen Massocca, head of trading at
Pacific Growth Equities, to Dow Jones Newswires. Chip titan Intel topped off
the week by raising its third-quarter revenue range above its prior outlook.
Broadcom was also a major winner within that group after it raised its
quarterly revenue forecast, while Advanced Micro Devices aided semis after
Barron's issued a bullish report on the firm's new Opteron chip. Still, there
is nothing like a disappointing report from a Dow component to stifle stocks.
Tech bellwether Hewlett-Packard posted a profit, reversing last-year's
deficit, but was punished for falling beneath analyst expectations. "Hewlett's
numbers gave an overall negative tone to the market," said Eastover Capital
Management's chief investment officer, Michael Kayes, to Reuters News. "Their
results do question its growth potential going forward, and they were
disappointing, even by their own admission." However, fickle investors were
quick to move on amid a batch of healthy economic news. Initial jobless claims
fell to a six-month low and the Philly Fed's business index jumped to a
surprising 22.1. Alfred Kugel, senior investment strategist at Stein Roe &
Farnham, remarked to the Wall Street Journal, "We had waves of good economic
news and that helped the stock market because it furthers the belief that
earnings can be substantially stronger in the second half." Market watchers
wait in sweet anticipation.
High-Tech Monday Update is provided courtesy of Thomson Financial. This
information is believed to be true and accurate; we take no responsibility for
inaccurate information and reserve the right to update our reports. For more
information, please visit our web site at http://www.thomson.com/financial.
SOURCE Thomson Financial Corporate Group
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