Just to add to your great post, the following is the summary for today from Robert Walberg, Briefing.com
Techs continued to pullback on Wednesday amid ongoing earnings concerns... JP Morgan cut its Q2 and FY02 sales/earnings estimates for Intel (INTC) citing channel inventory and price cuts... Also cut its estimates for Advanced Micro Devices (AMD)... Meanwhile, Morgan Stanley was reducing its ratings on a number of chip equipment companies, noting that the recent run up in price
leaves stocks trading ahead of their fundamentals... Interestingly, news in the chip equipment group was generally upbeat... Cymer (CYMI) upped its guidance; Novellus' estimates were raised by BofA; and Lam Research held up reasonably well due to rumors of a big order win... But market's blue mood prevailed and SOX (-4%) index helped pace the Nasdaq to another loss (-1.9%).
Chips weren't the only losers... Lucent (LU 4.92 -0.73) led a list of telecom/networking stocks broadly lower... LU hit by speculation that its convertible offering would exceed $1.5 bln... And it did... After the close, company confirmed $1.75 bln convertible offering, priced at 7.75%... Other losers in group included Nortel Networks (NT 5.21 -0.44), Extreme Networks (EXTR 9.13 -0.55), Foundry (FDRY 7.41 -0.31), Ciena (CIEN 9.15 -0.43) and Cisco (CSCO 16.36 -0.41).
Aside from the negative corporate news (not unexpected given advent of preannouncement season), overall market mood impacted by yesterday's disappointing economic numbers (retail sales for February rose by a less than expected 0.3%).
Amazing how quickly the bears come out of the woods after a couple of down days on widespread negative news... Just because the indices experience some normal corrective activity near the upper-end of recent ranges, are we now supposed to think that the economic recovery is a myth, or that the Nasdaq's big advance over the last 6-months is an illusion, or that the improvement in guidance/earnings is meaningless... We think not... The market is in the early stages of transitioning from recession to growth/ from bear market to bull... The news cycle during such periods is
understandably mixed... However, it's clear - at least to us - that conditions are better today than at any time in the past two years and that money market rates paying around 1% the allure of the market will be simply too great for most folks. |
