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Stocks Inch Higher Amid Mixed Quarterly Profit Reports

Posted on: Thursday, 24 July 2003, 06:00 CDT

Jul. 24--Stocks inched higher after a bad start yesterday, balancing disappointing profit announcements from Sun Microsystems and AOL Time Warner with better news from Kodak and Amazon.com.

By the close of trading, the Dow had gained 35.79 to close at 9,194.24, while the Nasdaq added 13.08 to 1,719.18.

While most quarterly profit reports have so far been better than expected, experts believe the market had already expected perfection, leading to the recent run-up in stock prices.

"The bar had been set very high, any negative news will cause some selling," said Jeff Swensen, head trader at John Hancock Funds. "I think we'll see the market trade sideways until we get some direction" for the rest of the year.

Shares of Sun Microsystems plunged 92 cents, or 19 percent, to $3.85 after the company reported its quarterly profit sank 80 percent from last year to $12 million. And the company's 2004 profit outlook was cut in half by Credit Suisse First Boston, which cited falling business demand for computer servers and hardware.

Telecom stocks were mostly down after Lucent reported a loss of 7 cents a share, a penny worse than analyst estimates. It was the 13th straight quarterly loss for Lucent, whose shares sank 11 cents to $1.80.

AT&T lost 29 cents to $19.53, while Qwest fell 12 cents to $4.31 and Verizon dropped 34 cents to $35.33.

On the plus side, online retailer Amazon.com surged $5.24 to $40.11 after sales of over a million Harry Potter copies helped cut last year's 25 cents per share loss in half.

No.1 discount broker Charles Schwab, which laid off 400 workers during the quarter, said profits rose 29 percent to 9 cents a share as investors returned to the market.

Ryder, the Miami-based truck rental company, drove increased efficiencies in its fleet to a profit of 55 cents a share, up from 47 cents last year.

Aerospace giant Boeing lost $192 million or 24 cents a share during the quarter, after taking a $1.1 billion tax charge. Boeing has now had two straight losing quarters for the first time in six years. Still investors, who expected a bigger loss, bid up shares 12 cents to $32.69.

By Spencer Morgan and Tom Van Riper

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(c) 2003, Daily News, New York. Distributed by Knight Ridder/Tribune Business News.

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