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To: Sig who wrote (9527)	10/25/2002 3:55:48 AM
From: stockman_scott	Read Replies (2) of 13815

General Commentary by Briefing.com... Indices succumbed to another light bout of profit-taking amid renewed fears of war in the Middle East... Decision to reduce exposure to tech stocks made easier by fact that Nasdaq was also approaching its 22-month bear trendline. Briefing.com also noted the other day that stocks getting less bang out of meeting/beating earnings estimates the deeper we move into earnings season... Two reasons for this in our opinion. First, fact that Q3 earnings aren't as ugly as originally feared is now an established story. Second, most of the big, sector moving tech companies have already released their results. Now getting many of the second and third tier names and any one report less likely to prompt sector/market-wide gains. If the earnings relief rally is close to running its course, traders need to ask themselves what the next catalyst will be for market. At this point, tough to think of many positives. Economic news likely to remain mixed, while tech firms making it painfully obvious that they see little to no improvement in IT spending environment. If true, earnings growth will remain very modest. Tech picture also becoming less accommodating, as recent spike relieved oversold conditions. We've yet to develop an extreme overbought short-term tone, so we could see some additional upside over next week or two. Scope of additional gains will be much more limited, however, as indices bumping up against major trendline resistance. With technicals nearing overbought territory and the fundamental backdrop still clouded by threat of war, mixed economic signals and lackluster earnings growth, Briefing.com contends that investors might want to use any additional near-term gains to reduce exposure to sector/market in anticipation of a more pronounced pullback. -Robert Walberg

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