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To: Annette who wrote (26574)	7/23/1999 9:09:00 AM
From: Ed Forrest	Read Replies (2) \| Respond to of 41369

Here is one view as to why the stocks are a tumbl'n... SUMMER EARNINGS SEASON REVISITED: SO WHY AREN'T THESE STOCKS GOING UP? By Chirag N. Amin, M.D. Despite stellar summer earnings in several of the big-name companies in the technology and Internet sectors so far, Internet companies have recently been taking it on the chin, sustaining declining stock prices, even in the face of good earnings news. Yahoo kicked off the summer earnings season by handily beating Wall Street expectations by 3 cents per share, followed by other large Internet companies, such as AOL, RealNetworks, and E*Trade, all reporting earnings that exceeded Wall Street estimates. Amazon.com not only met Wall Street earnings expectations, but also announced a 2:1 stock split. This type of news would have normally sent the stock soaring to new highs, but this has not occurred. So why have these Internet stocks not been running up? According to the "experts" on Wall Street, they state that this has been due to the sizeable pre-earnings run-ups that these stocks have already experienced, with many people using the typical "buy on rumor, sell on news" mentality. Other are postulating theories such as Y2K concerns, and continuing jitters about signs of inflation and rising interest rates. Needless to say, expectations have gotten to be extremely high in the Internet sector, as evident by the high whisper numbers that we have seen on various Internet stocks. As a result, Internet companies that voice even a slight hint of slowing revenue growth have been getting punished severely in terms of their stock price. Furthermore, the number of daytraders and other investors holding these stocks on a short-term basis for a "quick profit" have also increased, contributing to the extremely volatile nature of Internet stocks. So, are the days of big profits in Internet stocks over? I don't think so. Market sentiment weighs heavily on all sectors of the market, especially the Internet. And although market sentiment shows some vulnerability at this time, which is, in my opinion, why Internet stocks are not going up, this sentiment has been known to change rapidly. Watch closely what Federal Reserve Chairman Alan Greenspan says regarding the current market conditions in his Humphrey-Hawkins testimony to Congress. After all, it was his decision of a modest 0.25% rate hike, as well as adopting a neutral bias on interest rates, which allowed the NASDAQ, DOW, and S&P 500 to hit records highs.