Apple Takes Center Stage After Stocks Recover From AP's Hacked Tweet Dip

Michael Teague  |

Stocks have been kicked up and down since Monday of last week, the result of a tense earnings season that began with the shocking terrorist attack in Boston and its hideous and frantic aftermath.

Since that terrible afternoon, elected U.S. Senators, Congressmen, and the President have received letters containing deadly poison; public events all over the country have been subjected to heightened security measures; and an apparent terrorist attack on a Canadian train bound for New York was foiled. Citizens, including investors, have understandably been on edge as a result.

These events are perhaps, and very tragically so, to be expected in this day and age. But the real insult came on Tuesday morning in the form of a tweet from the Associated Press that read “Breaking: Two Explosions in the White House and Barack Obama is injured”.

It turns out that the AP’s twitter account was hacked, and the erroneous tweet lasted on the site for several minutes before being removed and disclaimed. In that short several minutes, however, the Dow alone lost 150 points.

The markets were quick to get back making gains, however, once the matter was cleared up, and all losses were recovered almost immediately.

The most anticipated news of the day was Apple's (AAPL) earnings report, released after the regular trading day that showed the company beating revenue estimates of $42.3 billion with a total of $43.6 billion. Apple also beat earnings per share estimates of $9.98 with a figure of $10.09, but saw gross margin shrink to 37.5 percent, one point below estimates.

The struggling tech giant also sold more iPhones and iPads than had been expected by about a million for each product, though it announced guidance for the current quarter that is substantially beneath expectations, $33.5 to $35.5 billion, versus what analysts had been predicting, which was $38.6 billion.

The company also announced that it would be returning $100 billion to shareholders by the end of 2015. Apple’s shares closed the day on a gain of 1.87 percent to $406.13.

The S&P 500 closed at 1,578.76, on a gain of 1.04 percent, with a huge day for Netflix (NFLX), whose shares were up nearly 25 percent to $217.50 as the company’s earnings report, released in late trading on Monday, seemed to unequivocally verify the controversial original content strategy that it pursued with the House of Cards series. The company counted almost 3 million users for the first quarter of 2013.


MetLife (MET) was up 5.7 percent to close at $37.83 after announcing its first dividend increase since 2007, while the luxury handbag maker Coach Inc. (COH) was up 10.5 percent to close at $55.91, after the company reported that earnings for the first quarter had increased 10 percent, comfortably ahead of expectations.

The Nasdaq was up 1.11 percent to 3,269.33 with Caesar’s Entertainment (CZR) up nearly 26 percent to $15.70 on news that the casino company would be splitting itself off into a new growth-oriented venture that would be less hampered by the companies tremendous amount of debt.

Tech stocks made gains based on the highest volume, including Intel (INTC), up 1.92 percent to $23.32, Cisco Systems (CSCO) up 1.68 percent to $20.93, Blackberry (BBRY), up 2.43 percent to $14.33, and Texas Instruments (TXN), up 2.50 percent to $35.68.

Office supply company Staples (SPLS) was down 4.5 percent to $12.40.

The Dow ended the day on a gain of 1.05 percent to close at 14,719.36, with one of the most notable gains coming from Bank of America (BAC), up 3.33 percent to $12.11 after its stock was upgraded to overweight by Morgan Stanley.

Chemical company E.I. du Pont de Nemours and Co. (DD) closed the day up over 4 percent to $52.49 after the company reported earnings that beat expectations, and forecasted strong growth for the remainder of the year. International Business Machines (IBM) stemmed some of their recent losses with a 2 percent increase, closing with shares at $191.61, after the company announced the acquisition of software delivery-automator UrbanCode.

Stock price data is provided by IEX Cloud on a 15-minute delayed basis. Chart price data is provided by TradingView on a 15-minute delayed basis.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not necessarily represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:

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