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smartmoney.com
smartmoney.com The bull market is dead, long live the bull market. Acampora says the market's recent tumble -- which could ultimately result in a 10% decline -- is just a hiccup. "At first blush, it is perfectly normal to witness a correction because the market became overbought as the Dow Jones Industrial Average gained 1,600 points in just two-and-a-half months. This overextended advance combined with a rise in interest rates to generate a sharp selloff." (Prudential Securities Research, May 19; New York Times, May 25).
Among the Dow 30, Acampora sees technical weakness only in General Motors (GM), which he believes is headed into the low 70s. Otherwise, it's smooth sailing, as he finds 135 large-cap stocks to be technically attractive. His list includes FDX (FDX), Ford Motor (F), Apple Computer (AAPL), American Express (AXP) and Sears (S). (Prudential Securities Research, May 19)
Acampora also says it's time to get back into "secondary stocks," the underloved, "undervalued" small- and mid-cap issues. Despite investor reluctance to believe in a recovery, he insists that "the strength in these new groups [energy, cyclical stocks and secondary issues] was merely an initial upward reaction and that investors [can] expect much more of a rise simply because the unfulfilled institutional demand is enormous." (Prudential Securities Research, May 5). |
