Microsoft Gives Tech Stocks Reason to Rally
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After leading the tech sector higher during the day, Microsoft kept the rally going after hours Thursday with another quarter of better than expected results and guidance.
Microsoft shares rose 4% in late trading on top of a 4% rise during the day after the company posted a 30% sales increase to $16.37 billion, beating out the $15.95 billion that analysts expected, according to Thomson Financial.
Microsoft's earnings of 50 cents a share were four cents better than expected, and the company's current quarter and full-year guidance were also as good or better than Wall Street analysts anticipated.
The report was welcome news for a tech sector reeling from disappointing results from bellwethers like Intel and Apple, and added to a dramatic two-day rally on hopes for an economic turnaround. Juniper Networks was another big gainer in late trading, rising 8% on a 73% jump in earnings, and that coming on top of a 7% rise ahead of the report.
The latest good news for the economy was a quick agreement by congressional leaders on a $145 billion economic stimulus package, the latest government effort to rescue the market and economy from the subprime mortgage market meltdown.
eBay was left out of Thursday's market rally, falling 6% after lowering its current quarter outlook and announcing the retirement of CEO Meg Whitman.
Qualcomm and Symantec were big winners after beating estimates, up 10% each, and Nokia soared 12% on its results, a sharp contrast to Motorola's 18% drop a day earlier. F5 and LSI rose more than 20% each on their earnings news, while Mercury Computing fell 32% on its results. AT&T shed 3% after the company met estimates.
Internet stocks were strong, with Yahoo, Google and Amazon up 5% or more, and HP, Dell and Cisco gained 4% each.
The Nasdaq rose 44 to 2360, the S&P gained 13 to 1352, and the Dow rose 108 to 12,378. Volume declined to 5.7 billion shares on the NYSE, and 3.05 billion on the Nasdaq. Advancers led by a 21-12 margin on the NYSE, and 17-13 on the Nasdaq. Upside volume was 64% on the NYSE, and 73% on the Nasdaq. New highs-new lows were 16-79 on the NYSE, and 43-130 on the Nasdaq.