Baker Street, London -- After Wall Street closed last night, leading computer chip maker Intel (NASDAQ: INTC) published its third quarter results, which missed the earnings estimates of many brokers. This microprocessor maker has been marked down heavily overnight on foreign exchanges and some market watchers fear a sell-off could take place when New York trading starts this afternoon. London shares were bearing up this morning. There was little blue colouring the screens but still tech stocks failed to fall as much as at first predicted.
Where would the FTSE 100 be without oil? This heavyweight sector has drummed up significant support over the years and now industry leader BP Amoco(LSE: BPA) accounts for almost 10% of the blue chip index. It was also about the only top-notch stock to register a gain this morning. The giant moved up 17p to 562p as reports of US oil reserve shortages pushed the price of crude oil up. This stopped the FTSE 100 from cascading completely. Amongst the mid-caps, Enterprise Oil(LSE: ETP) saw its shares rise 14.5p to 402p, for the same reasons.
Railtrack (LSE: RTK) recovered some lost ground, improving 25p to 1180p. A newspaper report suggested the Government may not now strip the rail network company of its safety role on the nation's railways, despite persistent rumblings to the contrary.
Top performer in the FTSE 100 though was Reed International(LSE: REED). The international media group might become the subject of merger talks with European competitor Wolters Kluwer, according to the new chairman of the latter publishing group. This sent Reed's shares up 9p to 362.25p. Another media player on the move was magazine specialist Emap (LSE: EMA). The Qualiport stock jumped 7p to 835p.
Elsewhere some retailing dogs were lifted by strong interim results from sports goods emporia operator JJB Sports(LSE: JJB). The one time go-go growth stock jumped 30p to 412.5p, still half its high of over a year ago, after delivering a forecast-busting 40% rise in pre-tax profits to £23.2m. Brokers were on average, only expecting a £19.3m figure. TMF Tiger will cover the results in their full glory in this afternoon's Fool's Eye View.
Somerfield (LSE: SOF) picked up 4.75p to 142p. Safeway (LSE: SFW) might bid for the off-colour supermarket chain.
Tech stocks were hit by the disappointing performance from Intel. Telecom stocks, which have enjoyed a good run recently, suffered the worst blows. Energis (LSE: EGS), widely expected to be gobbled up at some stage by a larger player, fell 106p to 1750p. Mobile specialist Vodafone AirTouch(LSE: VOD) dropped 13p to 302.5p and land line leader BT (LSE: BT.A) was off 40.5p at 961p. Orange (LSE: ORA) was also down 46p to 1374p.
TMF Essex takes a look at some technological innovations which could affect mobile phones in today's Lunchbox, below.
Despite rumours that United News & Media(LSE: UNWS) might try and take a significant stake in ONDigital, Granada (LSE: GAA), one of the partners in the venture, failed to get excited. Instead shareholders marked the shares down 25p at 495p. Perhaps they feel Granada might give up this valuable property too cheaply?
Finally, financial information provider the eXchange(LSE: EXC) continued its slide, plummeting 10p to 136.5p. The stock is now almost a third below its August starting price.
Yesterday's Fool's Eye View referred to a system called Bluetooth, and erroneously said it was based on infrared technology. I am grateful for a post on the Daily Fool message board from Martin Banham, in his first one to The Motley Fool, for correcting me by telling me it uses radio waves, and for providing a link to the Bluetooth website.
As telecoms are the flavour of the week I thought it worthwhile to explain Bluetooth a little more. Especially as I can crib bits from the website and gain a knowledge advantage that will last for at least half an hour.
Bluetooth, named after a tenth-century Scandinavian king famous for bringing warring tribes together, is designed to connect disparate devices using wireless technology. In the short term it will only operate over ranges of 10 metres, but there are plans to expand the technology so that an e-wallet can talk to a point of sale (POS) terminal and transfer e-cash. The goal of Bluetooth is simple. Its aim is to eliminate all the cables and infrared links that make the modern office and study look like the overflow from a spaghetti factory.
Bluetooth was developed by Ericsson, who realised that while people could make contact across thousands of miles using mobile phones, connectivity in offices between PCs, printers, phones and palmtop devices was abysmal. In 1988 Ericsson formed a Special Interest Group (SIG) to explore the potential of a low-power radio transmission system to fill this role. The SIG now boasts 700 members including such names as Nokia, IBM, Intel and Toshiba, who were the founders and who all support the standard, which is available to them on a royalty-free basis.
The system has now developed to the stage where the technology has settled on 2.4 GHz wireless ISM band (Industrial, Scientific and Medical) but using only 0.1 milliwatts, so it is below the leakage level allowed for non-transmitting electrical devices. This means it eliminates possible interference and health risks.
By mass-producing the radio chips Ericsson will be able to sell the transceiver for $10 and the Bluetooth module will be priced at $20 each by the first quarter of 2000. These chips will have the ability to transmit data at 1Mbps and, because it can hop 1,600 times a second between 79 channels, it is very secure.
So what does this mean for the investor?
If the concept works, and it eliminates all the cable and switching at the back of a PC, it probably isn't very good news for the likes of Cisco, GEC(LSE: GEC) or BATM(LSE: BVC). On the positive side, though, it could be fantastic news for mobile phones. One strategic assumption is that by 2004 75% of new mobile phones will be able to support payment by e-cash. In other words, it is part of the process that is converting the mobile phone into a "life tool".
But if the concept takes off there is virtually no end to the applications it could have in addition to paying for the groceries. Other uses could include such things as remote control of heating, air-conditioning, printers, faxes, stereos and kitchen equipment.
So, in the future, the world could be your toaster.
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