While this may not entirely be the information you and I are looking for it is a start, from WSJ. BTW, the author of this article is the one who has more or less been bashing IOMEGA at the WSJ. Remember the name. We should start to flood him with e-mail to EDUCATE him!
Dow Jones Business News -- June 20, 1996
For This Qtr Expiration, The Witch Isn't
Dead, The Market Is
By ROBERT O'BRIEN
Dow Jones News Services
NEW YORK -- In a significant departure from tradition, the stock market is
expected to drift through the rest of the week, giving a fleeting nod to
tomorrow's ''triple witching.''
The once-a-quarter expiration of the options on stocks, stock indexes and
stock-index futures normally creates quite a furor in the market, inflating volume
and prompting sharp, often-random shifts in market direction.
Those were the conditions during the last expirations, when the March 15 ''triple
witch'' fell on the market the way the house fell on the Wicked Witch of the East
in ''The Wizard of Oz.'' Trading on the New York Stock Exchange hit a record
for a week, with 2.3 billion shares changing hands - more activity even than the
week of the 1987 market crash.
Market watchers don't anticipate anything like that for this week.
''It looks to be a non-event,'' said Rick Holway, director of trading at Investment
Advisers Inc. in Minneapolis, adding, ''It's going to be quiet going into July.''
In fact, trading started the week at an anemic rate. On Monday, just 298 million
shares changed hands on the Big Board, the quietest full session this year and the
first time trading levels failed to reach 300 million shares for 1996.
While trading usually picks up as an options week wears on, the activity would
have to total more than a billion shares in today's and tomorrow's sessions to
rival the pace set in March.
''There's a different psychology to the market right now,'' said Larry Wachtel,
market analyst at Prudential Securities. ''I always believe that, in the market,
volume shows conviction.''
In March, that conviction was decidedly more aggressive than it is today.
''The March closeout was the epitome of aggressiveness,'' Wachtel said.
The handful of highly speculative momentum stocks - what Holway dubbed the
''grow-mos'' - had just taken its baby steps on the way to sharp gains. For
example, Iomega traded as low as 16 in mid-March, on its way to 55 a share in
mid-May; yesterday, it finished at 30 1/8.
In addition, the outlook for the economy was decidedly different at the end of
the first quarter. The week before the March ''triple witch'' came the surprisingly
strong report on February employment.
While the data spooked the market, sparking an intense one-session selloff,
investors were quick to dismiss the reading as an aberration; conviction
remained strong that the interest-rate environment was secure, and the
long-bond yield hung at just more than 6.5%.
Since then, investors have had to contend with two more readings of strong
employment - reports that argued the March numbers were dead right. The yield
on the long bond has traveled past 7%. And investors are worried about what
the Federal Reserve might do to interest rates at next month's Federal Open
Market Committee meeting.
''That's not to say the 'triple witch' should be ignored,'' Wachtel said. ''But the
market has gotten kind of soggy.''
Regards,
Erik. |
