Special to the Town Crier
Stock Report
Blue-chip stocks fell four straight days last week because of the chill from Brazil. But on Friday, when the Town Crier Fifty Weekly Stock Index went to press, stocks recovered and were ahead 150 points by noon.
The move demonstrates that even serious economic problems with an important trading partner like Brazil are not enough to undo the stunning rally in U.S. stocks that started after the first of the year.
What put a damper on the market, Brazil let their troubled currency float against major world economies. That created a stir with fear that Latin America's largest economy could drag down the entire region into a recession that could eventually reach United States.
The problem creates serious implications for U. S. companies because they are already having trouble selling goods in recession-wracked Asia.
To bring Brazil's troubles closer to Main Street Los Altos, since Brazil is a major exporter of coffee, look for coffee prices to jump and raise the price of a tall one at Starbucks.
With the Dow and the Nasdaq down, technology stocks in the Town Crier Fifty were also down, but Internet stocks like Yahoo, Infoseek and E-Trade made the index higher.
Two stocks made news last week when Apple Computer, a charter entry in the Town Crier Stock Index fell 8 percent. One day after reporting better-than-expected first-quarter earnings, an analyst voiced concerns about the company's second quarter and the pricing of its hot-selling iMac.
The Cupertino-based personal computer maker reported earnings for the first quarter that easily surpassed some of Wall Street's expectations, buoyed by iMac sales.
Last Thursday, after Salomon Smith Barney analyst Richard Gardner cut his rating on Apple's stock from a buy to a neutral, Apple's shares tumbled $5.0625 to close at $41.375.
Flextronics Inc. a Silicon Valley electronics manufacturer and Town Crier Index entry, exercised a declared two-for-one stock split on Jan. 11.
Noel, an experienced investor, covers the stock market for the Town Crier.