thestreet.com
Market Looking Flattish After Nasdaq 5000
By Thomas Lepri
Staff Reporter
3/10/00 8:27 AM ET
It looks it's shaping up to be a touch-and-go kind of morning.
At 8:10 a.m. EST, the S&P 500 futures were up 0.2, near fair value and not indicating much of a clear trend for the broad market.
As if anyone were talking about the broad market the morning after Nasdaq 5000.
Tech has seen a lot of reflexive snapbacks from big selloffs this year. But you may have noticed considerably fewer examples of the opposite phenomenon, the reflexive pullback from a big run-up. Yesterday, after all, the indefatigable Nasdaq Composite Index gained more than 3%, and you might expect the Globex futures to be pointing toward some consolidation in technology stocks at the open.
Yes, you might, if you'd just arrived on earth from a distant, unknown planet capable of sustaining human life. Tech may consolidate as the day goes on, but the Nasdaq 100 futures were lately up 11.05 to 4682.05, a slightly positive indication. Chalk it up to the incredibly positive sentiment surrounding the sector, which hasn't seen a decidedly negative preopen indication since the employment cost index and gross domestic product came in stronger than expected way back on Jan. 28.
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'It's great. It's like hair -- it keeps growing.'
-- Hugh Johnson, chief investment officer at First Albany
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Tech is on an unparalleled run, and investors who don't want to get hurt would do well to get out of the way. Value managers can only wait for the fund-flow fever to break. The latest data from AMG Data Services show that an overwhelming 76% of the money that investors have put into equity funds this year has gone into aggressive growth, tech, small-cap and biotech funds.
Portfolio managers aren't just chasing stocks. It's gotten to the point where the stocks themselves are chasing managers.
"I cut [my position in] Oracle (ORCL:Nasdaq - news - boards) in late December," said Hugh Johnson, chief investment officer at First Albany. "And I cut it again yesterday, because it got to 11% of my portfolio. I cut it back to 8%, but it'll soon be back at 11%. It's great. It's like hair -- it keeps growing."
One stock that has been chasing a lot of managers is Rambus (RMBS:Nasdaq - news - boards), which this morning set plans for a 4-for-1 stock split.
Qwest (Q:NYSE - news - boards) and U S West (USW:NYSE - news - boards) were each trading lower on Instinet after Qwest said that a major phone company -- which nearly everyone believes to be Deutsche Telekom (DT:NYSE ADR - news - boards) -- had pulled out of discussions to buy the two companies. Qwest was down at 50 1/4 from a close of 57 1/8, while U S West was down at 70 from a close of 75 3/4.
The bond market was edging lower, with the 10-year note down 4/32 to 100 31/32 and yielding 6.366%. No major data are scheduled for release.
The large European indices were moving higher near midsession, paced by the Paris CAC, which was up 89.19, or 1.4%, to 6512.62. Frankfurt's Xetra Dax was up 74.62, or 0.9%, to 8023.77, while the London FTSE was up 64.7, or 1%, to 6596.8.
The euro was lately trading up at $0.9669.
Asian markets were generally firm overnight.
In Hong Kong, the Hang Seng added 194.83, or 1.1%, to 17,831.86, thanks largely to a rally in Hutchison Whampoa (HUWHY:Nasdaq ADR - news - boards), which rose 5.9%.
Cyclical stocks caught bids in Tokyo after Japan's Economic Planning Agency said that core private machinery orders rose 0.8% in January, confounding expectations for a 7.7% decline. That data helped the Nikkei close up 88.07 to 19,750.40.
But other Japanese indices fell. The Topix index, which is composed of all shares listed on the Tokyo Stock Exchange's first section, fell 10.47 to 1633.30. The Jasdaq small-cap index shed 45.82, or 1.9%, to 117.04, while the Nikkei over-the-counter shares slipped 45.82, or 1.9%, to 2422.67.
The dollar eased slightly to 106.28 yen. The downside is limited by fears of another Bank of Japan intervention and expectations that today's improved capital spending data could presage a better-than-expected report on fourth-quarter gross domestic product next week.
The greenback was lately trading at 106.67 yen.
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