Investors couldn't ask for much better news heading into the heart of the corporate earnings season. With the Dow Jones industrial average and Nasdaq both perched at record highs in the middle of summer, earnings reports from the likes of Intel and Apple should keep the rally alive.
For the week, the Dow Jones industrial average closed up 45 points to 11,193.70 while the Nasdaq composite added 52 points to close at 2,793.06.
With very few significant earnings warnings in the technology sector, it appears the group that was a laggard for much of the past two months is primed to resume a leadership role.
"We are still on track for a very strong second quarter," said Joseph Abbott, equity strategist at I/B/E/S, which tracks earnings estimates for Wall Street.
Technology investors will pay close attention to Intel Corp.'s (Nasdaq: INTC) second quarter earnings due out this week.
The chip-manufacturing giant is expected to report a profit of 53 cents a share, according to a survey of analysts by First Call Corp.
Last quarter, Intel raked in $2 billion, or 57 cents a share, on sales of $7.1 billion.
However, there has been some lively debate in the investment community over just how good Intel's second-quarter and fiscal year results will be.
This week, BancBoston Robertson Stephens cut its estimate from 53 cents a share to 52 cents a share in the quarter and lowered its fiscal 1999 estimate from $2.25 a share to $2.19 a share. BBRS is concerned that lower-than-expected unit volume will take a bite out of its sales this year.
Intel shares closed up ? to 66 ? Friday.
The stock peaked at 71 13/16 in January after falling to a low a post-split low of 34 7/8 in August.
Thirty of the 26 analysts following Intel rate it either a "buy" or "strong buy."
There might be even more excitement for Apple Computer Inc.'s (Nasdaq: AAPL) third-quarter results.
On Friday, the stock surged to a 6-year high of 55 5/8, mainly on the strength of an upgrade from BancBoston Robertson Stephens.
First Call consensus expects it to earn 64 cents a share in the quarter and $2.78 a share in the fiscal year.
Apple has simply been on a hot streak of late, topping analysts' estimates in each of its past five quarters. Not too long ago, you couldn't give away Apple shares.
Last quarter, it made $93 million, or 60 cents a share, on sales of $1.53 billion.
The stock was trading at just 28 ? in October.
Twelve of the 21 analysts following the stock maintain either a "buy" or "strong buy" recommendation.
Don't forget about that quiet Internet power Inktomi Corp. (Nasdaq: INKT), either.
It will also announce its third-quarter results this week with analysts expecting a loss of 12 cents a share.
For Inktomi, it's all about the revenue.
Its shares closed up 1/8 to 140 Friday.