Welcome to week 136 of my stock-picking throwdown with Mr. Market. Let's get right to the numbers.
|Harris & Harris
|Taiwan Semiconductor (NYSE: TSM )
|S&P 500 SPDR
Source: Yahoo! Finance.
*Tracking began on Aug. 7, 2008.
**Adjusted for dividends and other returns of capital.
You win one, and then you lose a lot more. That's been the story of my battle to best Mr. Market since December, and last week was no exception. My tech portfolio gave back 83 basis points in a week that was good for most stocks, none more so than small caps.
The Russell 2000 advanced 2.78% for the week and is now up 8.05% for the year, CNBC reports. None of the other indices came within a percentage point of matching the Russell's performance, but all did well. The Nasdaq ended up 1.7% while the S&P 500 added 1.42% and the Dow increased 1.28%.
Better-than-expected employment data drove Friday's gains and allowed all four indices to finish the week on a high note. Unemployment fell to 8.8% as nonfarm payrolls rose by 216,000, according to Labor Department data. American industry is hiring again.
Increases in big-ticket purchases may be helping to add jobs. Automakers Ford (NYSE: F ) and General Motors (NYSE: GM ) each posted double-digit sales gains for March, while Chrysler moved 31% more vehicles during the month.
The week in tech
But it was the innovators that most enjoyed the week's rally. Shares of e-commerce specialist GSI Commerce (Nasdaq: GSIC ) soared 51% after eBay agreed to acquire the company for $2.4 billion in cash to better compete with rival Amazon.com (Nasdaq: AMZN ) , which was busy figuring out how to better compete with Apple (Nasdaq: AAPL ) .
On Tuesday, the e-tailer unveiled a Web-based music-streaming service called Cloud Player. The promise? Upload or purchase any DRM-free track and play it directly from inside a browser page. Amazon's version of Lala.com, in other words.
Cloud Player is also part of a broader online storage offering called Cloud Drive. Those who sign up get 5 gigabytes of space free. Buy an album and you're upgraded to 20 gigs of capacity. Either way, Amazon seems determined to play host to every piece of digital content users own by creating a locker for their purchased e-goods.
In less encouraging news, Microsoft's (Nasdaq: MSFT ) chief research and strategy officer, Craig Mundie, told an audience in Sydney that he couldn't decide whether large-format tablets would "remain with us." Translation: The iPad may already be dead. Or irrelevant. Anything but the screaming success that the data says it's already become.
Don't expect this to go well, Fool. By treating tablets as the Bigfoot of the tech world rather than the disruptor that they are, Mr. Softy is ignoring a basic truth of tech investing: Disruptive innovation is capable of unleashing billions in stock market wealth.
Look at David Gardner. He produced a decade of 20% returns in the real-money Rule Breaker portfolio by betting on a collection of innovators and then holding them for the long term. Tom Gardner's "simpleton portfolio" was also a 10-year winner. I believe that, with my tech portfolio, I will achieve similar success.
Now let's move on to the rest of today's update:
- Taiwan Semiconductor fell slightly after an analyst at Bank of America/Merrill Lynch cut his ratings on all of Asia's major contract chip manufacturers. His reasoning? Supply-chain disruptions triggered by the earthquake and tsunami that struck Japan last month, Forbes reports.
There's your checkup. See you back here next weekend for more tech-stock talk. In the meantime, don't forget to keep up with my tech portfolio by adding all five stocks to your watchlist.