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Technology Stocks : JDS Uniphase (JDSU)
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To: larry who wrote (19811)3/28/2001 9:44:41 PM
From: t2  Read Replies (2) of 24042
 
larry, I guess your assumptions about the economy are that we are headed into a severe recession.
That is the only way bear market to bear market comparisons can be made if one looks at stock market valuations.

I agree there is a good chance of a recession precisely because of the bubble bursting fallout. I doubt it will get bad enough to last a long time. Therefore, those companies that are holding back spending on IT or pushing it out, could come back as soon as they digest the economic reality in a few months. If they decide the consumer is still strong and there is only a pause in the economy, spending budgets will get increased pretty quickly. All of this will somehow be linked the stock market as well.

I am betting on a big rebound in April in technology and other sectors. Expecting a broad based advance for the markets for a couple of months after it stabilizes around current levels (or slightly lower). Don't think if it will be sustainable unless some tech companies state that they see demand picking up again. A Microsoft or Dell could do that with their earnings. I doubt Intel could due to pricing pressures and competition from AMD. That would get a subsector of tech going....and later affecting other sectors.

I am remaining mindful of the degree of damage in the markets from bursting of the Naz bubble. I don't think anyone realizes how much damage has been done...and to me this the big unknown. I end up going back and forth on this point with every new statistic released. Expecting the economic releases to get worse soon...contrary to the expectations of most economists. But on the other hand.....<g>

That is what will make it very difficult to believe in the economy unless the market bounces back BUT the market can't bounce unless things improve in the economy. This process is going to be fascinating in the coming months. I am still inclined to take up long positions in April.
The short interest is at all time highs and company sharebuybacks are non-existent. Any lower, and we could see that support come in to the market...another factor to watch.

JDSU was also now has less support due to its short interest decreasing by 50% in March. It stood out in that sense since most other optical/communication stocks saw increases.
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