Sector Siesta – Spotlight on Networking
By Andy Stout (astout@sir-inc.com)
6/21/2002 1:57 PM ET
Last Wednesday, I pointed out that the AMEX Networking Index (NWX: sentiment, chart, options) was trading at an all-time low and that we needed to see fear, not complacency, from investors before we would see a true bottom in the NWX. Since that day, the NWX has lost an additional 18 points and hit a new all-time low today.
Bad news came for the NWX this morning when Bank of America (BAC: sentiment, chart, options) issues a plethora of downgrades on networking companies. These downgrades were for Nortel Networks (NT: sentiment, chart, options) , Lucent Technologies (LU: sentiment, chart, options) , Juniper Networks (JNPR: sentiment, chart, options) , ONI Systems (ONIS: sentiment, chart, options) , CIENA (CIEN: sentiment, chart, options) , and Cisco Systems (CSCO: sentiment, chart, options) . This does not make matters any better for the NWX.
On the sentiment front, the NWX's put/call open interest ratio has been rather torpid as it has gone nowhere in the last week. What does this mean? The investors remain complacent. This leaves the NWX extremely vulnerable to further decline. |
