The Wall Street Journal-20080125-Microsoft Trades Actively- as Does Yahoo
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Microsoft Trades Actively, as Does Yahoo
Traders bracing for earnings from a technology bellwether and a deal rumor helped drive trading.
Microsoft Corp. saw heavy action ahead of its earnings report, which came after the close of afternoon trading. The software company posted better-than-expected earnings and issued an optimistic outlook for the year.
Microsoft shares, which rose 4.1% to $33.25 in 4 p.m. Nasdaq Stock Market composite trading, added 4.5% after hours.
Ahead of the earnings report, 447,000 call contracts changed hands, nearly five times the average daily volume this month. Volume surged in the last hour of trading.
Option trading in Yahoo Inc. also picked up after a report suggested the Internet company's sagging share price makes it a takeover target. The report from the New York Post said no formal buyout talks are taking place. News Corp. owns the New York Post and Dow Jones & Co., the publisher of The Wall Street Journal. A representative for Yahoo said the company doesn't comment on rumors. Yahoo shares picked up 8.4% to $21.69 on the Nasdaq.
Meanwhile, trading in Walt Disney Co. suggested investors expect sharper-than-normal stock moves coming out of the media giant.
"They figure if this market comes back at all, it's hard to believe Disney will stay down," said Joe Kinahan, chief derivatives strategist with thinkorswim, an online brokerage specializing in options.
Shares of Disney and other entertainment companies have been hurt by several worries about the economy and by the strike by Hollywood writers.
Disney's stock price is down more than 9% this year. Disney shares were up 2.5% yesterday to $29.23 in 4 p.m. New York Stock Exchange composite trading.
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Scott Morrison contributed to this article.
