The Battle Road Tech Index™ rose nine percent for the week ended July 17, 2009, closing at 1359. For the week, 23 of the 25 Index components were in positive territory. Year-to-date, the index is up 36 percent, having started at a value of 1000.
The following is our summary and commentary for the week:
The positive earnings from Intel (NASDAQ: INTC – $18.79) as well as a general positive feeling in the market have spurred double digit share price increases for ten of our 25 index components, including the aforementioned Intel, which rose the most, 17 percent:
• Western Digital (NYSE: WDC – $29.24) 15 percent
• IBM (NYSE: IBM – $115.41) 14 percent
• eBay (NASDAQ: EBAY – $18.55) 14 percent
• Yahoo! (NASDAQ: YHOO – $16.84) 13 percent
• Texas Instruments (NYSE: TXN – $23.01) 13 percent
• Cisco Systems (NASDAQ: CSCO – $20.51) 12 percent
• Adobe Systems (NASDAQ: ADBE – $31.02) 12 percent
• Amazon (NASDAQ: AMZN – $85.85) 11 percent
• Netflix (NASDAQ: NFLX – $44.14) 10 percent
In advance of many of these companies’ earnings reports next week, this growth demonstrates market confidence in important tech names, as well as talk of partnerships and potential M&A activity. Despite the uncertainty of the economic recovery, many tech stocks are performing vibrantly.
Intel reported better than expected results on July 14, 2009, citing an improvement in mobile processor shipments. Its new line of server processors, Nehalem, was also relatively strong, although IBM reported a 22 percent decline in x86 server shipments. Nevertheless, Intel’s results suggest that tech spending has bottomed.
In stark contrast to many of the gainers on the week, Nokia (NYSE: NOK – $13.38) was one of the few declining stocks. The company reported less than stellar earnings yesterday for its second quarter. The company reported revenues of 9.9 billion euros, when expectations had been for a 10.3 billion euro showing. The company sees no expansion in its market share, nor operating margins in the second half of the year. These three factors are contributing to the general bearish sentiments on Nokia.
