eBay Tops Estimates, But Microsoft Warns

eBay rose after hours on Thursday after topping estimates, but Microsoft fell on an earnings warning.

Stocks gave back strong gains during the day, but managed to finish the day up.

The ISDEX http://www.wsrn.com/apps/ISDEX/ rose fractionally to 204, and the Nasdaq climbed 30 to 2046. The S&P 500 climbed 7 to 1215, and the Dow rose 40 to 10,610. Volume rose to 1.34 billion shares on the NYSE, and 1.88 billion on the Nasdaq. Advancers led 17 to 12 on the NYSE, and 21 to 15 on the Nasdaq. For earnings reports, visit our earnings calendar at http://www.wsrn.com/apps/earnings/internet.xpl and reported earnings at http://www.wsrn.com/apps/earnings/ireported.xpl. For after hours quotes and news, visit our after hours trading site at http://www.afterhourstrading.com.

Just a week after announcing it would meet estimates, Microsoft fell 3 points after the close after meeting estimates, but guiding down next quarter’s estimates to 39-40 cents a share from estimates of 45 cents.

Also after the bell, eBay regained ground lost during the day after topping pro forma estimates with earnings of 12 cents a share. Fully diluted earnings of 9 cents a share met estimates, a rarity for an earnings season that has been marked by huge accounting write-offs. eBay also raised guidance for the second half of the year by 5%-10%.

Other companies reporting after the bell included Sun Microsystems , which rose after topping estimates by a penny but guiding estimates lower; Commerce One , which missed estimates; and Scientific Atlanta , which fell on an earnings warning.

During the day, IBM slipped .28 to 104 after missing revenue estimates of $22.6 billion by $1 billion. Siebel plunged 6.09 to 31.55 on its earnings report, Travelocity dropped 5 to 27.50, and i2 fell 1.69 to 11.40. Mercury Interactive climbed 1.13 to 35.32, and Broadcom rose .60 to 39.60.

Dell rose .60 to 27.80 after reaffirming earnings guidance, but said revenues will hit the low end of estimates, and the company also announced it will take a $700 million charge for bad investments.

Nokia surged 2.50 to 19.50 after topping lowered estimates and saying it expects modest growth in the second half.

Extreme Networks surged 2.83 to 25.57 on better than expected earnings news.

Ariba lost .54 to 4.27 despite besting estimates. Speechworks rose .57 to 12.62 despite missing estimates.

Some technical comments on the market: Note: We include charts in the technical market commentary. If you can’t get the charts via the e-mail newsletter version, try this link: http://www.afterhourstrading.com/column.html

The Dow (first chart) appears to be forming a bearish rising wedge in the hourly chart, and was stopped at that upper trendline today. In the daily (second chart), it could still be forming an inverse head and shoulders bottom. Almost any move down tomorrow would likely break that bearish wedge, setting up a potential retest of the lows. 10,430 is support, and 10,700 is likely to cap any rally. The Nasdaq (second chart) turned back at its steepening downtrend today (the blue lines). First support is 2000, and below that 1972 is the next likely target. A move above 2080 would be a plus. The S&P 500 (third chart) cleared its downtrend line at about 1212 today, but will likely fall back below that line at tomorrow’s open. 1200 is important support. Tomorrow-Monday is a possible turn date; we’ll see if the market gives any clear direction the next two days.

Special report: For a free introduction to technical chart patterns and an overview of last year’s action in the stock market, visit http://www.internetstockreport.com/guest/article/0,1785,2571_500051,00.html.

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