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Dell Beats Estimates

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May 17, 2002

Dell beat estimates and raised guidance after the bell on Thursday, capping a day that saw modest gains despite continued weak economic reports.

The ISDEX http://www.wsrn.com/apps/ISDEX/ added 1 to 130, and the Nasdaq gained 4 to 1730. The S&P 500 rose 7 to 1098, and the Dow climbed 45 to 10,289. Volume declined to 1.24 billion shares on the NYSE, and 1.64 billion on the Nasdaq. Decliners led 17 to 14 on the NYSE, and 19 to 15 on the Nasdaq.

After the close, Dell rose after beating estimates and raising guidance. Analog Devices and Wind River also beat estimates, Serena matched estimates, Agilent missed, and Autodesk warned.

During the day, Brocade fell 3% despite guiding estimates higher.

i2 rose 10% on a PeopleSoft takeover rumor.

The Baby Bells – SBC , Bell South and Verizon – continued to post strong gains, causing some analysts to wonder if the battered telecom sector is bottoming. JDS Uniphase surged 7%, and other telecom stocks rose despite continued accounting concerns. Lucent may be working on an inverse head and shoulders bottom, with resistance at 4.90 (see market commentary below).

InfoSpace rose 45% on a deal with Verizon, and Openwave surged on positive analyst comments.

Marvell fell 7% on negative analyst comments.

Instinet rose 10% on news that the company may acquire the Island ECN.

Some technical comments on the market: Note: To see the charts in the text email newsletter, click on the internetstockreport.com story link at the top of the newsletter.

The S&P 100 (see first chart below) is close to taking out some major resistance here; a close above 560 would comfortably negate the index’s recent breakdown and be a pretty bullish sign. The Nasdaq (second chart below) is still quite a ways from its main downtrend line around 1750. The index has resistance all the way up to 1820, and 1696 is critical support. The Dow (third chart) continues to sit just below the critical 10,350-10,600 area. 10,150-10,225 is important support (fourth chart). The S&P 500 (fifth chart) continues to struggle at the important 1100 level, but it’s holding important support in the 1088-1091 range. Finally, is that an inverse head and shoulders bottom forming in Lucent (sixth chart)? The stock needs to get above 5 to cement a bottom, a very tough resistance level.

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