OUCH OUCH OUCH THERE GOES MY RETIREMENT and VACATION! psffft can you spare a buck foe some lunch?
=Gerard Klauer Co-Chmn: Blue Chip Correction Healthy For Mkt
NEW YORK (Dow Jones)--A decline in blue-chip stock values Monday might signal an end to the flight of money from U.S. equities, according to Gerold Klauer, co-chairman of investment firm Gerard Klauer Mattison.
"Today you saw some of the large-cap companies that have done very well and were responsible for the large moves you've seen in those indices start to correct," Klauer said in an interview on CNBC Monday. "I think that's very healthy for the market longer term."
Klauer speculated that Monday's blue-chip decline, when the Dow Jones Industrial Average shed another 58.45 points, might be the result of investors raising cash for other reasons. For Klauer, those reasons should be reinvestment in beaten-down equities.
"I hope a good part of (that cash) will go to where the value is in the small- and mid-cap sector," he said.
As for value, the strategist likes "some of these technology stocks that have gotten hammered." He mentioned Cisco Systems Inc. (CSCO), Microsoft Corp. (MSFT), Network Associates Inc. (NETA) and Apple Computer Inc. (AAPL).
Further down the road, Klauer has reason for some optimism: as third quarter financial results come due, he forecast that investors might be in store for more upside earnings surprises than downside.
"Because companies that were going to report negative results have preannounced," he explained.
-Scott Eden; 201-938-5173
(END) DOW JONES NEWS 10-05-98
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