WHAT'S UP WITH THE MARKET
Late last year, Greenspan was doing his best to keep the market up, even postponing an interest hike to maintain an
orderly market. Any slowdown in the market could potentially result in a stampede for the gates, particularly with increasing interest rates and Y2k fears providing cause for fear.
The money flowed to fewer and fewer stocks, but the market
kept afloat and didn't crash. Now Mr. Greenspan has sought fit to raise interest rates and move to the other side of the fence in an attempt to slow the market down.
What happened was that a few stocks moved with a vengeance like there was no tomorrow. Institutional and mutual fund money followed the Mo in an attempt to buffer up poor results in many sector funds. High tech plays were in every stock mutual fund that I looked over, regardless of the definition or target sector of the fund.
The turn of events has left long time winners like Warren Buffet holding the bag. Perhaps Warren was considering a subscription to TM's Society Annomy (sp). Never before have I seen the amount of media coverage being spun away from big money fund managers and towards alternative gurus. Any one catch the recent WSJ article on Joe Copia or the profile on Tokyo Joe found in this week's BizWeek? I wouldn't be surprised to see Instock on the cover of next month's Forbes.
So, lets take a moment to make some sense of the current situation. First, nothing has changed fundamentally in the high tech sector. The high techs are still leading the market. Caution is necessary to at least temporarily avoid the stocks that have been the benefactors of more attention than they deserve, but overall the high techs will continue to drive the market. Examples; the semiconductors aren't ready to slow down and the storage manufacturers are just now catching the wave.
Biotechs have been on a nice run. I've posted why I thought the biotechs would be hot in November and the same factors exist now. There has been some expected profit taking over the last week or so, but there are still some great opportunities in this sector.
Dow large caps have been ignored and offer fantastic value. To illustrate the ridiculousness and how absurdly the market has been reacting, take a look at Aeroflex. All they did was announce that they are moving from the Naz to the NYSE and the stock went wild.
So, while Mr. Greenspan continues to orchestrate, we continue to see a fantastic market full of wonderful opportunities, although I find it scary that more and more
people are talking about stocks in more and more places.
Two sectors that I've been investing in over the last couple of months have been utility and paper/lumber. There has been a slight turn in each of these sectors, but obviously its early in the game if a turn actually comes at all. I am just nibbling at this stage with positions in mutual funds and not yet individual stocks.
Another sector that offers great opportunity, is Canada. You might recall that I bought (FICDX) FIDELITY INVESTMENT TRUST CANADA FUND. Here's a list of their holdings as of late last year.
BCE INC(BCE) 0.0% 100,900 -14,400 -12.5% $12.3 +2.0% 10/31/99
2 NORTEL NETWORKS CORP(NT) 0.0% 57,300 +45,200 +373.6% $7.1 +1.0% 10/31/99
3 TORONTO DOMINION BANK(TD) 0.0% 84,600 +40,800 +93.2% $2.0 +2.1% 10/31/99
4 SEAGRAM COMPANY LTD(VO) 0.0% 32,000 +16,100 +101.3% $1.9 +0.8% 10/31/99
5 JDS UNIPHASE CORP(JDSU) 0.0% *6,090 +6,090 -- $1.7 +1.3% 10/31/99
6 ROGERS COMMUNICATIONS INC(RG) 0.0% *47,200 +47,200 -- $1.5 -1.4% 10/31/99
7 ONEX CORP(ONEXF) -- *42,500 +42,500 -- $1.3 +5.8% 10/31/99
8 BOMBARDIER INC(BDRBF) -- 46,600 -32,200 -40.9% $0.9 -2.4% 10/31/99
9 BANK OF NOVA SCOTIA(BKNSF) -- 50,500 -26,500 -34.4% $0.9 -11.8% 10/31/99
10 THOMSON CORP(TMSCF) -- 27,400 -1,300 -4.5% $0.9 +11.9% 10/31/99
11 SUNCOR ENERGY INC(SU) 0.0% 20,800 +9,900 +90.8% $0.8 +0.2% 10/31/99
12 ROYAL BANK OF CANADA(RY) 0.0% 18,400 +9,200 +100.0% $0.7 +1.4% 10/31/99
13 BARRICK GOLD CORP(ABX) 0.0% 44,500 +20,500 +85.4% $0.7 -3.0% 10/31/99
14 CANADIAN PACIFIC(CP) 0.0% 38,000 +27,800 +272.6% $0.7 -2.0% 10/31/99
15 RIO ALTO EXPLORATION LTD(RIAEF) -- 42,500 -3,400 -7.4% $0.7 +1.8% 10/31/99
16 INCO LTD(N) 0.0% 40,200 +33,700 +518.5% $0.7 -5.7% 10/31/99
17 IMASCO LTD(IMASF) 0.0% 22,900 -21,200 -48.1% $0.7 +0.4% 10/31/99
18 NOVA CHEMICALS LTD(NCX) 0.0% 41,300 +35,700 +637.5% $0.7 +0.4% 10/31/99
19 DOMTAR INC(DTC) 0.0% 59,200 +48,700 +463.8% $0.6 +1.2% 10/31/99
20 C MAC INDUSTRIES INC(CIDIF) -- *20,400 +20,400 -- $0.6 -5.6% 10/31/99
21 CELESTICA INC(CLS) 0.0% 11,500 +5,700 +98.3% $0.6 +3.9% 10/31/99
22 ENSIGN RESOURCE SERVICE G(ERSGF) -- 19,700 -400 -2.0% $0.5 -2.0% 10/31/99
23 BIOVAIL CORP INTERNATIONAL(BVF) 0.0% *10,400 +10,400 -- $0.5 -6.7% 10/31/99
24 TEKLOGIX INTERNATIONAL IN(TKLXF) -- 30,500 +4,000 +15.1% $0.5 -4.2% 10/31/99
25 QLT PHOTOTHERAPEUTICS INC(QLTI) 0.0% *7,400 +7,400 -- $0.5 +5.7% 10/31/99
26 CANADIAN NATIONAL RAILWAY CO(CNI) 0.0% 18,300 +9,900 +117.9% $0.4 +0.8% 10/31/99
27 RESEARCH IN MOTION LTD(RIMM) 0.0% 3,200 -2,200 -40.7% $0.4 -2.3% 10/31/99
28 ATCO LTD CL I NV CDA(ACLLF) -- *16,000 +16,000 -- $0.4 +13.8% 10/31/99
29 COGECO CABLE INC (F)(CGEAF) -- 13,000 -900 -6.5% $0.4 -0.8% 10/31/99
30 GILDAN ACTIVEWEAR INC(GIL) 0.1% 11,800 +3,200 +37.2% $0.4 -2.5% 10/31/99
31 COGECO INC(CGECF) -- 11,600 -2,000 -14.7% $0.4 +2.5% 10/31/99
32 INTERTAPE POLYMER GROUP INC(ITP) 0.1% 14,600 -1,100 -7.0% $0.3 -2.2% 10/31/99
33 ENBRIDGE INC(ENBR) 0.0% 18,050 +13,050 +261.0% $0.3 -1.4% 10/31/99
34 LOBLAW COMPANIES LTD(LBLCF) -- 13,900 +8,200 +143.9% $0.3 +1.3% 10/31/99
35 BANK OF MONTREAL(BMO) 0.0% 10,500 +2,500 +31.3% $0.3 +0.2% 10/31/99
36 CANADIAN NATIONAL RESOURC(CDNRF) -- 12,400 +3,000 +31.9% $0.3 +0.6% 10/31/99
37 ALIANT INC(ALINF) -- *12,500 +12,500 -- $0.3 -2.6% 10/31/99
38 BREAKWATER RESOURCES LTD(BWLRF) 0.2% *140,000 +140,000 -- $0.3 -6.3% 10/31/99
39 MACKENZIE FINANCIAL CORPORATION(MKFCF) 0.0% *19,200 +19,200 -- $0.3 +1.4% 10/31/99
40 PLACER DOME INC(PDG) 0.0% 27,500 +10,500 +61.8% $0.2 -4.9% 10/31/99
41 COMVERSE TECHNOLOGY INC(CMVT) 0.0% 970 +70 +7.8% $0.2 -2.4% 10/31/99
42 CANADIAN HUNTER EXPLOR LT(CDHEF) -- *12,500 +12,500 -- $0.2 +1.9% 10/31/99
43 GST TELECOMMUNICATIONS(GSTX) 0.1% *22,000 +22,000 -- $0.2 -0.9% 10/31/99
44 FRANCO NEVADA MINING LTD(FNMCF) -- *19,256 +19,256 -- $0.2 -0.2% 10/31/99
45 JABIL CIRCUIT INC(JBL) 0.0% *2,190 +2,190 -- $0.2 +8.3% 10/31/99
46 ALCAN ALUMINIUM LTD(AL) 0.0% 6,050 -6,950 -53.5% $0.2 -2.2% 10/31/99
47 TALISMAN ENERGY INC(TLM) 0.0% 6,800 +3,400 +100.0% $0.2 +0.2% 10/31/99
48 MOLSON COS LTD(MLSAF) -- *11,500 +11,500 -- $0.2 -2.3% 10/31/99
49 NEXTEL COMMUNICATIONS INC(NXTL) 0.0% *1,080 +1,080 -- $0.2 +4.4% 10/31/99
50 MAPLE LEAF FOODS INC(MLFNF)
Yep, the Bomber is in there and some high tech as well. But it's also a play on natural resources and Canada itself.
Speaking of Canada, The TSE 300 Index up 13% in 2000 so far. How about The Canadian Venture Exchange? Since it opened less than four months ago, the exchange has more than doubled in value.
Sergio
ps Thanks for your DD on IP. Well done Ditch. |
