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To: Wally Mastroly who wrote (12327)	3/8/2000 1:50:00 PM
From: Wally Mastroly	Respond to of 15132

Re: Small caps..misleading because the performance there is so narrow... -via another thread: smallcapcenter.com March 7, 2000 by Catherine Pears Super Tuesday turned into Bloody Tuesday as equities markets of all sizes were ravaged by investors? worries. Small cap indexes struggled to reverse heavy losses incurred in the morning but never succeeded. And the Dow Jones Industrial Average, after plummeting by 300 points early on, continued to bleed all day to lose 3.7% at the day's close. Even techs and biotechs were hurting today. The only sector showing big gains was oil and gas, as growing doubts about the new commitment by the Organization of Oil Producing Countries (OPEC) to increase production has sent future prices of the benchmark West Texas crude oil past the $34 a barrel mark. But for the small cap indexes, even the Wilshire Small Cap 1750 which at first was having an excellent run, Tuesday was a down day. The small cap Russell 2000 sank 1% or 6.20 points to 595.44 points, the S&P 600 lost 1.42% or 3.16 points at 219.91 points and the Wilshire closed at 922.71 points, off 1.9 points or 0.2%. The small caps were still close to record levels, though, after a torrid ending last week. The small caps, especially the tech-heavy Russell 2000, have been attracting huge amounts of money from the more traditional stocks. "But the perception that the small and mid caps have begun to move in this market is a bit misleading because the performance there is so narrow. It is mainly tech and biotech stocks," Peter Glidden, chief investment officer of Northwestern Trust of Seattle says. But even in these high-powered sectors, investors will get burned if they are not cautious. "Earnings are the key, the sole driver of the stock market since we are in a rising interest rate environment,"he adds. "Only earnings can move stock prices higher." What makes this market so frustrating to a manager like him are the extremes. "The other (non-tech) stocks don?t just sit there; they continue to get pummeled and get cheaper." As an example of this over-reaction, he points to consumer goods giant Proctor & Gamble (NYSE: PG) which lost 30% in value today and dragged down the entire Big Board on its earnings warnings. "The cheap get cheaper and the rich get richer."