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Page 216 One of these products, for example, is the hard drive. Hard drive companies (such as Seagate or Western Digital) in turn depend on other businesses such as disk platter makers or electronic component makers to produce their products. If there is evidence that disk platter makers are doing well, it could be deduced that ultimately orders from the PC sector may have increased in response to higher consumer demand for PCs. This could signal a strong performance from the PC makers which could help boost their stocks.
Other Company/Institution Investment - Many large companies in
search of ways to diversify their businesses or their own investments
many deem a certain smaller company worthy of investment. This
could result in the larger company making a significant stock purchase
in the smaller business in order to gain a substantial controlling
position in the smaller company. This move usually boosts the smaller
company's stock price. In addition, investors could view such a move as
a vote of confidence for the smaller company and push its stock price
even higher by buying up shares. An example of this would be Red Hat,
whose flagship Linux product is a promising operating system for
computers. |
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