US stocks did remarkably well ending higher on Wednesday after Apple declared its third fiscal quarter numbers for the year. Though the markets kept a guarded approach due to the Ukraine and Gaza crisis, Apple rallied after the results pulling up other tech stocks. Apple Inc gave one of the biggest lifts to the market, rising 2.6 percent to $97.19 as concerns faded about the iPhone maker's margins. Dow component Microsoft Corp rose 0.1 percent to $44.87 after the company said it aimed to get its money-losing Nokia phone unit to break even within two years.
Biotech stocks ranked among the day's biggest gainers, boosted by some strong results and drug trial data. The Nasdaq Biotech index jumped 2.2 percent in its fourth straight day of gains.
"Earnings season has been going very well, beating on both the top and bottom line, which suggests companies will continue to execute well," said Alan Gayle, senior investment strategist at Ridge Worth Investments in Atlanta.
Despite good quarter numbers, analysts are worried about the new product line up this year. Apple is set to launch iPhone6 this year. Pacific Crest Securities sent a client note right after the results saying that Apple stock won't have much downside due to the good profit margins and the launch, according to media reports. However, the launch would be critical to determine is it has a significant upside.
Apple has sold 35.2 million iPhones last quarter compared to 31.2 million in the same quarter a year ago. But if the numbers are subdues because people have been postponing their buy due to the upcoming launch, it is good news for the company.
but the big worry for the company could be the 9% fall in iPad sales, a market that has clearly not moved on from traditional PCs to tablets. ALso, newer competitors like Microsoft and Google are emerging in the tablet space, though Apple is stil managing to maintain its market share. Upgradations in tablets are also fewer and people do not find a purpose to change and buy newer tablets as much as they do with phones.
Research analysts have targets on the stock ranging from $105-110, and the company will really have to work their way to reach the targets.
Among the companies that reported results after the market closed, Facebook Inc posted stronger-than-expected revenue growth and its stock climbed 3.5 percent to $73.80 in extended-hours trading. TripAdvisor Inc shares tumbled 9.4 percent to $97.25 in after-hours trading after the travel website company reported earnings that missed expectations.
In the biotech space, Biogen Idec reported sharply higher-than-expected quarterly revenue on surging sales of its new treatment for multiple sclerosis and raised its full-year profit forecast. Its stock shot up 11.2 percent to $337.60.
With inputs from agencies