Big tech continued to do extraordinarily well in the third quarters. Stocks that would seem to have outrun their earnings continued to climb.
Among the members of the S&P 500, Apple (AAPL) rose 27% to $153.47, very near its multi-year high. The market still believes that Mac sales will be strong into the holiday season and that new versions of the iPod will continue to expand that franchise.
Amazon (AMZN) kept moving North. Its shares rose 37% and now are up 137% for the year. The company has launched its own music download service and the video Unbox product. But, it share price increase may have more to do with the market’s belief that AMZN will keep its marketing and technology costs down.
Nvidia (NVDA), the graphics chip maker, is benefiting from the surge in laptop sales Improved graphics performance is critical to most PC with the rising of computer based video games and increased online video consumption.
Among members of the Dow, tech stocks also did extraordinarily well. HP (HPQ) rose 13%. Its lead in PC sales helped its share price. IBM (IBM) rose 12% for the quarter. Its software services business continued to grow and cost cutting activity at the firm appears to reap endless benefits.
Douglas A. McIntyre