Tech profits please Wall Street
By 3 News online staff / AP
Profit results from US corporates are coming in thick and fast now, with some of the big names like Google and Microsoft announcing their latest earnings.
So far Wall Street likes what it's hearing, and the Dow is up 72 points this morning to 13,784, putting it on track to close at its highest level since October 31, 2007.
IBM led the Dow's 30 stocks, surging 5 percent. Without the jump in IBM, the Dow would be flat.
The Standard & Poor's 500 index was up one point at 1,493, while the tech-heavy Nasdaq composite rose 11 points to 3,154.
The quarterly earnings season is off to strong start. Of the 83 companies in the S&P 500 that reported through Tuesday, 54 of them have beaten Wall Street's estimates, according to S&P Capital IQ.
IBM's results beat expectations, thanks to its lucrative Internet-based "cloud" computing business and other software services. IBM also raised its earnings outlook for the current year. Its stock rose US$10.12 to US$206.19.
Google jumped 6 percent after its earnings climbed at the end of last year to US$2.9 billion as online advertisers spent more money in pursuit of holiday shoppers. Google rose US$44.63 to US$747.60.
Advanced Micro Devices also posted results that were better than analysts had expected. The world's second-largest maker of microchips, behind Intel, posted a smaller loss and higher revenue than analysts had forecast. AMD jumped 9 percent, making it the top stock in the S&P 500. It rose 22 cents to US$2.65.
Apple however is expected to announce its first fall in profit in a decade.
"Its share price has dropped about 30 percent over the past six months," says 3 News business editor Michael Wilson. "There's been a bit of disappointment about iPhone 5 sales."
The drop is likely to be small however.
"They're only talking a couple of percent – a fall to about US$12.8 billion, a very minor figure."
3 News / AP