Apple Shines as Intel Stumbles

Apple gave investors reeling from Intel’s earnings report reason for hope late Wednesday.

Apple’s quarterly earnings of $1.14 a share were well above 78-cent estimates, and 24% sales growth to $7.1 billion beat $6.42 billion forecasts. iPod sales of 21 million also blew past analysts’ estimates, but Mac sales of 1.6 million were a little light.

The company’s March quarter guidance left a little to be desired, however. Earnings of 54-56 cents and sales of $4.8-4.9 billion would come in below 60-cent and $5.22 billion Thomson Financial forecasts.

After initially popping 5% on the news in after-hours trading, Apple shares gave back the gains during the company’s conference call to trade down slightly.

Intel shares lost 5.7% during Wednesday’s trading session after weaker than expected gross margins raised fears of a prolonged price war with rival AMD . Stronger than expected wholesale inflation data also weighed on stocks.

Rackable Systems plunged 38% on a warning.

Cisco lost 3.8% on a number of valuation downgrades.

Blackbaud fell 10% on a warning and the acquisition of Target Software and Target Analysis Group.

The Nasdaq fell 18 to 2479, the S&P 500 slipped 1 to 1430, and the Dow lost 5 to 12,577. Volume rose to 2.69 billion shares on the NYSE, but declined to 2.38 billion on the Nasdaq. Advancers led 17-15 on the NYSE, while decliners led 17-13 on the Nasdaq. Upside volume was 57% on the NYSE, and 26% on the Nasdaq. New highs-new lows were 245-20 on the NYSE, and 148-39 on the Nasdaq.