Microsoft, Ma Bell Highlight Change

Thursday’s news said much about the changing nature of technology.

AT&T , the venerable Ma Bell, unceremoniously tossed from the Dow a year ago, may be returning to the index — as part of SBC , its onetime offspring. (Not to say we told you so, but we did.)

And Microsoft , a Dow component since 1999, continued to be the most dependable tech stock on the planet, delivering earnings and revenues after the bell that topped Wall Street forecasts.

Those two paragraphs were once unthinkable. AT&T was for decades the ultimate safe stock, delivering stable earnings and dividends long before Microsoft was even an upstart. But deregulation, competition and a brutal shakeout in the telecom sector have caused AT&T’s revenues to decline for the last 10 years.

Microsoft, meanwhile, has gone from high-flyer to stable dividend payer in that time. The company reported pro forma earnings of 36 cents a share after the bell, beating estimates by three cents, and revenues of $10.82 billion also bested forecasts. Both business and consumer demand was strong, and the company’s home and entertainment divisions turned profitable for the first time. Shares of Microsoft rose 2% after hours.

Nothing changes faster than technology, and nothing drives that point home more than the stories of Ma Bell and Microsoft.

Stocks were mixed Thursday, as blue chips were weighed down by an earnings miss from Caterpillar .

The Nasdaq rose 1 to 2047, the S&P 500 edged higher to 1174, and the Dow lost 31 to 10,467. Volume declined to 1.6 billion shares on the NYSE, and 2.14 billion on the Nasdaq. Advancers led 18-14 on the NYSE, while decliners held a 15-14 edge on the Nasdaq. Upside volume was 58% on the NYSE, and 51% on the Nasdaq. New highs-new lows were 154-19 on the NYSE, and 74-46 on the Nasdaq.

Also after the close, Broadcom , Novellus , Overstock , Microstrategy and SanDisk beat estimates.

During the day, VeriSign fell 13% on its results, while Cabot Micro , RSA , Sierra Wireless, JDS Uniphase and Genesis Microchip slumped on their reports.

Nokia rose 6% after beating estimates, and Websense , LSI and Digital River gained on their results. Orckit rocketed 40% on its earnings report.

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