By Kate Gibson
A leader in the U.S. stock market's lengthy climb, technology's
role in the rally will soon be tested, with Intel Corp.'s results
expected to shed light on the industry at large going into the
holiday shopping season.
"Tech needs to confirm, period," said Marc Pado, U.S. market
strategist at Cantor Fitzgerald.
Investors on Tuesday will hear third-quarter financials from
Intel (INTC), the world's largest semiconductor company, kicking
off the technology earnings season, with rival Advanced Micro
Devices Inc. (AMD) scheduled to report two days later.
Both companies are expected to benefit from an improving
consumer PC market, and an anticipated increase in corporate
demand. .
In addition to AMD, IBM Corp. (IBM) is also slated to report
earnings next Thursday, with Big Blue's earnings expected to rise
and sales expected to decline slightly from a year ago. .
"In the end, companies will need to sell those goods to
consumers. The fourth quarter will be all about the consumer, not
necessarily the third quarter," said Pado in a research note.
The third quarter, according to Pado, represents the transition
from manufacturing and shipping for the holidays, and finally,
selling to consumers.
"This early in the process, we are seeing confirmation that the
season won't be as bad as many fear, even if it isn't as great as
many had hoped," he wrote.
On Friday, health-are and information-technology shares fronted
gains as the major indexes headed toward a solid weekly advance of
roughly 4%.
The Dow Jones Industrial Average (DJI) rose 35.67 points to
9,822.54, with IBM proving by far the Dow's biggest advancer, its
shares lately up 2.1% at $124.85. Barclays Capital on Friday upped
its price target of IBM to $140, saying the company has momentum in
hardware and continued to execute well in other areas.
The S&P 500 Index (SPX) gained 2.06 points to 1,067.54,
while the tech-laden Nasdaq Composite Index (RIXF) added 9.32
points to 2,133.25.