NEW YORK ( TheStreet) -- As usual, the summer earnings season could set the tone for the rest of the year, or at least the period before the holiday shopping season kicks off.It's usually a bad idea to make aggressive directional bets on stocks ahead of earnings. You'll hit some winners, but the losers can wipe you out.
Intel(INTC - Get Report), Microsoft(MSFT - Get Report) and Nokia(NOK - Get Report)I group these three stocks together because they have several things in common. In particular, each company has a fair bit riding on the release of Microsoft's Windows 8 operating system. That comes this fall. Additionally, all three companies could report relatively weak second quarters. Over at Forbes, Patrick Moorhead explains why that is in this defense of Intel Ultrabooks:
Ultrabooks are primarily targeted at the consumer market, secondarily to the commercial market. Each market has different selling cycles of ups and downs. For most regions, the consumer market has three main cycles. First, is "Back to School," which hits primarily in Q3. Then you have "Holiday", which hits primarily in Q4. Then in Q1 you have western markets "Post-Holiday," which hits in January and Chinese New Year in February. Q2 is absolutely the slowest quarter in consumer PCs, and it has been for 20 years. Everyone close to the PC market knows this. That's just one reason why jumping to any conclusions about Ultrabooks based on Q2 are dangerous.Add in Windows 8 anticipation and you can clearly see why it's too soon to judge not only Ultrabook sales, but practically everything Intel, Microsoft and Nokia have their paws in. On weakness, I intend to aggressively buy INTC, followed by somewhat less aggressive purchases of MSFT and smaller, speculative shots at NOK. I would put 65% of a pot of money towards INTC, 30% towards MSFT and the remaining 5% towards NOK.