Franklin Fund Managers Say
Now Is The Time To Buy Stocks
07-11-01 05:38 PM EST by John Shipman | Of DOW JONES
NEWSWIRES
NEW YORK -(Dow Jones)- Now is a good time to buy stocks.
That was the general consensus among a roundtable of Franklin
Templeton Investments mutual fund portfolio managers gathered
Wednesday for a midyear look at trends in the equities markets.
The gathering was also the first official event held at the firm's new
corporate headquarters in San Mateo, Calif., and was broadcast via
teleconference.
Concerning a rebound in equities markets, "the question is when, not
if," said Ed Jamieson, chief investment officer for domestic equities at
Franklin.
"Stocks often look most expensive when they're the cheapest,"
Jamieson suggested.
Ian Link, portfolio manager of the Franklin Technology Fund,
cautioned that there's still negative news to plow through for tech
companies.
"Unfortunately, we have six more months of winter," Link predicted,
but he noted that, historically, stocks tend to begin rebounding three to
six months before an earnings trough is reached.
To take advantage of an upturn, investors "need to be in the market
before the darkest point," he said.
In the tech sector, Link said he favors names in outsourcing - such as
Paychex Inc. (PAYX) and Sapient Corp. (SAPE) - as well as
broadband players Sonus Networks Inc. (SONS) and Ciena Corp.
(CIEN) and data storage providers Brocade Communications
Systems Inc. (BRCD) and Veritas Software Corp. (VRTS).
Terri Spath, manager of the Franklin Large Cap Growth Fund, said
more reasonable stock valuations, signs of a trough in the economy
and evidence of a "stealth bull market," are all signs that now is a good
time for investors to buy stocks, "and large-cap growth stocks in
particular."
As evidence of a bottom in the economy, Spath pointed to data such
as an improvement in the National Association of Purchasing
Managers report, lower overall inventories and still vigorous consumer
spending.
During the second quarter, 80% of Standard & Poor's 500 stocks
posted gains, she said, which points to a stealth bull market. She
noted that there hasn't been such market breadth since the first quarter
of 1998, and the S&P 500 went on to post a 16% return over the
following 12 months.
-By John Shipman, Dow Jones Newswires; 201-938-5171;
john.shipman@dowjones.com
(This story was originally published by Dow Jones Newswires) |
