NEW YORK ( TheStreet) -- Serial earnings beater Apple ( AAPL) reports after the bell today and shares could use another shot of the earnings magic the company has displayed over the past year. PowerShares QQQ ( QQQQ) is the ETF to play a rebound in Apple shares if that indeed takes place.Apple's stock has declined for more than a week due to reception problems with their new iPhone. When left-handed users are holding the phone, the natural placement of their hand can cause it to lose reception and drop calls. Apple's response was ham-handed, at first saying the problem was software related, then acknowledging it was an antenna malfunction. Last week, the company said it would supply free phone cases for customers having issues with existing phones, as well as offer rebates for consumers who want them. The company is working to correct the problem permanently for new phones. The hit to shares derailed the otherwise steady performance of Apple stock. Since announcing earnings in late April, shares had climbed as much as 10% by late June, compared to a 10% decline in the S&P 500 Index. As the reception problems became widely known, Apple's gains evaporated and it now has a slight loss since April 20.
PowerShares QQQ has the greatest exposure to Apple of any ETF, at 19% of assets. This heavily overweight position makes it the best choice for a technology ETF during a period of Apple's outperformance. Aside from Apple, other holdings in QQQQ report earnings this week. IBM ( IBM) reported yesterday, while Microsoft ( MSFT), Yahoo! ( YHOO) Qualcomm ( QCOM) and eBay ( EBAY) report later this week. While not a direct technology play, Amazon ( AMZN) also reports, as do biotech companies Gilead ( GILD) and Genzyme ( GENZ). Shares of GILD rallied 3% yesterday on news that a gel developed by the company reduced the risk of contracting AIDS and other sexually transmitted diseases. I expect the rest of the holdings in QQQQ should do reasonably well over the next few days as earnings and outlooks come in slightly ahead of expectations. The only major negative earnings event so far was Google ( GOOG), but that was partly due to the company's focus on long-term growth. Conversely, companies such as Intel ( INTC) are reporting their largest quarterly profit in company history, while Advanced Micro Devices ( AMD) is reporting its largest quarterly revenue in company history. Strong earnings across the industry should lift all technology ETFs, but I suspect QQQQ's Apple boost will move it to the head of the pack this week. At the time of publication, Dion Money Management owned QQQQ.
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