Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: J.T. who wrote (1719)	12/3/1999 12:10:00 PM
From: LBstocks	Read Replies (2) \| Respond to of 19219

Merrill strategist sees global markets overbought NEW YORK, Dec 3 (Reuters) - Merrill Lynch global strategist Trevor Greetham threw a bearish bug into the markets Friday amid a broad Wall Street surge, saying equities are close to overbought and technical indicators do not support the rally lasting into the year 2000. ``Last month we said that technical indicators were supportive of a rally that could last into the New Year. They are no longer so supportive,' Greetham, based in Merrill's London office, said in a research note. ``The markets are rallying from oversold levels on the hope that the Fed has finished raising rates,' he said. ``But if equity prices continue to rise, U.S. consumer spending is likely to stage a strong recovery going into 2000.' That would push the U.S. Federal Reserve to start hiking interest rates again in the New Year, once Year 2000 concerns are in the past, Greetham said. Merrill Lynch added that it is overweight cash, meaning in a model portfolio the firm recommends holding more cash than most funds and investors do currently. Merrill issued the note as Wall Street stocks rocketed to record levels after a tame U.S. jobs report. The technology-driven Nasdaq composite index (^IXIC - news) pierced the 3,500 level to trade up 82.23 to 3535.01, a record high. The Dow Jones industrial average (^DJI - news) was up 253 points to 11291 - just 30 points from a record while the Standard & Poor's 500 index (^SPX - news) was up 31 to 1440, a new intraday high. Globally, Merrill said it is overweight cash in Europe, noting only the Italian equity market is in oversold territory. The firm is only overweight equities in the Japanese market. ``The prospect of a bust turning to boom is Japan's economy should not be ignored,' Greetham said, adding that Japanese equities are getting a boost from a strong yen. ``As long as the yen is strong, Japanese monetary policy is likely to remain ultra-loose,' he said. ``The U.K. market is overbought while many of the European countries that were deeply oversold last month, including Germany and France, have moved into neutral territory,' Greetham said.