Byron Wien- the bear sees-
Tuesday October 28 9:53 AM EST
Morgan Stanley sees selloff as precursor to rise
NEW YORK, Oct 28 (Reuters) - Morgan Stanley Dean Witter's U.S. equities strategists Byron Wein and Peter Canelo wrote in a research report Tuesday that they believe the recent market sell-off ''is a precursor to a significant upward reversal in the stock market.''
said that over the short-term, investors may continue to worry about the developments in Southeast Asia and their effects on U.S. multinationals. said market leadership on next upswing ''is likely to come from domestically oriented companies and those multinationals with little exposure'' to the Association of South East Asian nations' region.'' said the following sectors should benefit most in the market's prospective recovery: consumer cyclicals, retailers, media, transportation, energy, health care (especially pharmaceuticals) and selected technology. said highlights ten stocks that have held up better during the recent decline and should continue to outperform as the market recovers. The stocks have a better-than-average outlook on a technical perspective, and have shown positive earnings revision trends in recent months for 1997 and 1998 earnings. the ''shopping list for recovery'' includes Cisco Systems Inc (CSCO), Lowe's Cos Inc (LOW), AMR Corp (AMR), PeopleSoft Inc (PSFT), Home Depot Inc (HD), CVS Corp (CVS), Schlumberger Ltd (SLB), Gap Inc (GPS), Eli Lilly and Co (LLY) and Time Warner Inc (TWX).
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More news for referenced ticker symbols: AMR, CSCO, CVS,
PS- John- I think the best way I have been working in this markets is S&P options with very tight stop losses - I am buying the dips like 940 calls and around 940-60 reversing- now this needs a hands on approach but it would not be a bad idea to keep working on index options- I will certainly try to evolve something on a daily basis- like trading options with entry points and exit and strict atop losses. I am only worried that this strategy has to be implemented without 'external fears ' of portfolio- so far luckily the ratio is alright -but anyway if you really want it and there is some interest from the family at large -we can work on something. |
