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Politics : Idea Of The Day

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To: Dom B. who wrote (9602)	9/17/1997 4:40:00 AM
From: IQBAL LATIF	of 50167

Barrons and WSJ failed miserably once again to badmouth the market and MSFT- Last Friday when I initiated long AMAT and some other stocks with confirmation of a reversal in bonds I have initiated on Tuesday morning several long positions in DOW stocks - I could not post yesterday because of server was down- but following is the list : G- bought 85 calls IBM- bought 105 calls INTC- bought 110 calls GE-bought 70 calls TBR- bought 100 calls deep in the money TMX- bought 50 calls CSCO- 75 calls AIG- 105 calls I think the failure of third test of 910 Dec contract for me was a very bullish development- I also like that 'mountain of irrational exuberance' is replaced by 'plateau of rational expectations'- all the flap has been taken off and market is punishing laggards with vehemence- this is a market wanting to go up and will take out new highs during course of next couple of weeks- with the earning seasons approaching one of my yard stick is - 'courier companies profits' Fed express came with phenomenol increase alongwith 'industrial production' came 0.7%- although highest but signals a coming season of singing profits and .3 PPI uncertainity was confirmed by CPI lower rates .2 and .1- Although capacity utilisation indicates higher number that even does not deter me- if there is no inflation we cannot create for our darling Analysts- this is AG's new economy and 'Philips curve' relationships -unemployment and inflation are dying- productivity is the new name of the game and yesterday numbers finally drive a nail for next four weeks in the coffin of inflation. My next important milestone is 'Employment cost Index' between now and that release date I expect a smooth run. I am very bullish on Techs. I have deliberately maintained a neutral stance towards DOW stocks but the stocks mentioned above plus some others represent good values. I also bought ASND and COMS and will continue to add - I also think that we will see some good rally in techs - taking advantage of LRCX fall I also added that- when I went seventy percent cash I was a bit early but with a benefit of hindsight I feel comfortable to be establishing some interesting positions in some of the best companies in the world. I was expecting the resistance of 960 to be decisively probed yesterday I think it was only briefly touched- look at the divergence in S&P and DOW - yesterday S&P made new highs but DOW is still 400 points down from the high- this correction of 700 points has taken a lot of additional hype out of stocks like G and Phepls Dodge- for me this is a certain change in direction and people still having berish thoughts should look at the bonds at 115,13 with next level at 115,24- I presume we will see bonds at 116 within next four sessions- the channel of hi and lo's my other indicator is showing improvement although Monday sell off was good for the market, we had a true correction very much reqd by networking and MSFT- however I still think some DOW stocks are a good buy- at these levels- When I said DOW is a steal at 8000 - I have finally put my money where my mouth was. DOW is 7900 and going higher- Steve on Friday asked me if we are in a a bear trend and I replied that this is a perfect bull trend and a perfect correction within a trend - I hope we can take advantage of this.

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