Barrons - April 26, 1999
Big Boost From Big Blue Lifts the Market
By JACQUELINE DOHERTY
Tables: Vital Signs | A Mid-Cap Revival?
Thanks to help from IBM, technology shares once again asserted their dominance as market leaders. The celebration over Big Blue's strong earnings, released Wednesday night, continued Friday as the shares climbed 5 1/4 points to a new high of 199 3/4. The gain was particularly impressive considering it followed Thursday's jump of 22 5/8.
"IBM was the most important and most impressive news of the week," says Jay Amore of Amore Capital Group.
The upbeat IBM earnings proved that computer sales are not slowing in the U.S. and indicated that sales in Asia are picking up as well. Another plus: The report suggested that IBM could successfully sell its products through its dealers and via the Internet at the same time.
Perhaps most importantly, the news convinced investors that Compaq's woes, reported a week earlier, did not signal an industrywide problem.
"IBM has been able to do what Compaq has not been able to do successfully: operate in both channels," said Timothy Ghriskey, a senior equity portfolio manager at Dreyfus.
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