Intel and Electronic Arts Lead Tech Stocks Higher as Dow Surges
As impressive as the Dow Jones Industrial Average's surge was early Friday -- the index added more than 140 points as of 11:30 a.m. EST -- Dow component Intel's gain was even better, with the chip maker rising 3%. Video game publisher Electronic Arts was up more than 4.5%, while Pandora Media shed more than 2.4%.
Jobs report beats expectations
There is perhaps no single economic release more important than the monthly nonfarm payroll report -- a beat or miss has the potential to significantly move the market, and Friday's release was no exception. The report indicated that the U.S. economy added 203,000 jobs in November, more than the 180,000 economists had expected.
A stronger-than-expected labor market is a great sign for the economy, and by extension the stock market, though Friday's beat was uniquely good in that it wasn't too far above expectations. A sharply higher number might have notably increased the probability that the Federal Reserve would pull back on its asset purchases.
Intel gets upgraded
PC chip maker Intel was beating the broader market early on Friday after analysts at Citigroup upgraded the stock from neutral to buy. Citigroup believes that demand for PCs among corporations is stabilizing -- a good sign for Intel, which provides the processors for most traditional personal computers. Citigroup's opinion is largely in line with IDC forecasts; the research firm predicted earlier this week that PC demand would stabilize around 300 million units per year.
The rise of tablets and smartphones, along with persistent economic weakness, may have damped the demand for traditional PCs. Although it is trying hard, Intel's efforts at cracking into mobile have borne little fruit. If the traditional PC market is close to a bottom, it should provide a margin of safety for Intel's business going forward.
Analysts come to EA's rescue
Shares of video game publisher Electronic Arts plunged on Thursday after the company said it would halt production on all games at its DICE studio. DICE is responsible for the Battfield franchise, and its recently released Battlefield 4 has been suffering from severe bugs.
But EA is getting back some of what it lost on Friday, after Piper Jaffray analysts defended the stock, reiterating their overweight rating and $33 price target. With Battlefield 4 having so many problems, some had speculated that Battlefield 5 would be delayed, perhaps indefinitely. Piper Jaffray, though, continues to expect the next installment in the franchise to be released next year.
Pandora slumps as Spotify plans revamp
Shares of Internet radio giant Pandora were down after competitor Spotify announced that it would introduce an ad-supported free model of its service for mobile listeners.
Until now, Spotify's service, which allows for on-demand music listening rather than just radio streaming like Pandora, had been hamstrung by a mobile limitation. Although users could access Spotify's library for free on a desktop computer, those who wanted to listen on a mobile device were forced to pay. Pandora's service, in contrast, is free on mobile devices. By offering a free mobile option, Spotify should emerge as a more potent threat to Pandora.
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The article Intel and Electronic Arts Lead Tech Stocks Higher as Dow Surges originally appeared on Fool.com.Sam Mattera has no position in any stocks mentioned. The Motley Fool recommends Intel and Pandora Media. The Motley Fool owns shares of Citigroup and Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.