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To: Killian who wrote (111223)	8/6/2000 8:11:42 AM
From: puborectalis	Respond to of 120523

Sunday August 6 7:12 AM ET What Will Election Do for Markets? By Kenneth Barry NEW YORK (Reuters) - The stock market's performance may not be able to predict who will be president. But a look at historical trends on Wall Street and in U.S. elections offers some tantalizing possibilities. And regardless of the outcome at the polls, election years are good for stock prices most of the time. Republicans have just sent off Texas Gov. George W. Bush (news - web sites) as their standard bearer from their national convention in Philadelphia, where hats, pins and stuffed animals shaped like the Grand Old Party's mascot, the elephant, were all the rage. The Democrats soon will have their turn to do the same for Vice President Al Gore (news - web sites) at their convention Aug. 14-17 in Los Angeles. (There's no word yet on whether the Democrat's mascot, the donkey, will be given any alpha-male pointers before the fun begins.) The race remains close. And with three months to go before the Nov. 7 ballot, few pundits want to predict a winner. To get a handle on whether the market can forecast the election, analysts at Salomon Smith Barney looked at 28 presidential election cycles beginning in 1888, when Republican Benjamin Harrison defeated Democrat Grover Cleveland. Party In Power When the party in power was re-elected, stock markets advanced 81 percent of the time (13 out of 16 elections) and fell 19 percent of the time (three elections), a ``fairly significant'' correlation, the Salomon analysts said. ``As a barometer of election results, an up market no doubt would reflect satisfaction with the incumbent party,'' the Salomon report said. When the party in power is given the boot, the stock market's performance was more of a toss-up. Stocks advanced 58 percent of the time (seven elections) and retreated 42 percent of the time (five elections). Chances for a bull market are better in election years: Stocks were up 71 percent of the time (20 elections) but were down 29 percent of the time (eight elections) in an election year. In another measure, analysts at Morgan Stanley Dean Witter found the fourth year of a presidential term was good for equities. Beginning with data from 1948, when Democrat Harry Truman defeated Republican Thomas Dewey in an upset, stocks returned 15.2 percent on average in the fourth year of a presidency, the second-best performance in four-year presidential terms. Fiscal Stimulus Morgan Stanley attributed that finding to stimulative fiscal policies and said it didn't matter whether Republicans or Democrats were working the levers of power. The best six-month period in a president's fourth year has been from the end of May through November. Stocks did even better in a president's third year, averaging a 23.3 percent return, Morgan Stanley found. Gains were more modest early in an administration, returning on average 7.1 percent in the first year and 10.9 percent in the second year. Salomon Smith Barney also looked at post-election trends and found stocks don't do so well in the final months of an election year if the party in power changes, which occurred 12 times. The market was down 67 percent of the time. It advanced only 33 percent of the time. The first year after an election historically was a poor performer, especially following the ouster of the incumbent party, according to data going back to 1914. In that year, the Dow Jones industrial average was significantly revised, Salomon said. A possible explanation may be that the new president immediately proposed unpopular policies to correct perceived mistakes by the previous administration, which the market found to be a bitter pill to swallow. Since the start of the year, the Dow Jones industrial average (^DJI - news) has dropped 6.34 percent. The Nasdaq Composite Index (^IXIC - news) has fallen 6.93 percent, and the Standard & Poor's 500 Index (^SPX - news) has slipped just 0.43 percent for the year. On Friday, the Dow average rose 61.17 points to end at 10,767.75. For the week, the Dow gained 256.58 points, or 2.44 percent. The technology-driven Nasdaq finished up 27.48 points on Friday at 3,787.36 -- up 124.36 points, or 3.39 percent for the week. And the S&P 500 index added 10.37 points, or 0.71 percent, on Friday to close at 1,462.93 -- up 3 percent for the week.

To: Killian who wrote (111223)	8/6/2000 8:14:36 AM
From: puborectalis	Read Replies (1) \| Respond to of 120523

BKHM...... The Coming Week in Europe: Britain Awaits Fiber-Optic Darling's Report By Nick Watson Senior European Correspondent 8/6/00 12:40 AM ET LONDON -- In Britain next week, earnings results from Bookham Technology (BKHM:Nasdaq ADR - news) and QXL.com (QXLC:Nasadq ADR - news) -- two companies that belong to the so-called "New Economy" -- are expected to illustrate well the idea that a gold rush tends not to enrich those who dig the gold from the ground, but the companies that build the equipment to dig it out. Bookham, one of the new darlings of the British technology sector, will announce its second-quarter results on Wednesday. Analysts expect Bookham's revenues to increase to £4.2 million from £2.5 million the previous quarter and losses before interest and tax to fall to £5.7 million from £8.9 million. The excitement about Bookham centers on its proprietary manufacturing technology for silicon-based integrated optical circuits, which generate, detect, route and control light signals in fiber-optic telecommunications networks. This process, known as ASOC, replaces the conventional labor-intensive approach to manufacturing optical components with standard high-volume semiconductor production methods. Dr. Andrew Rickman, the founder and chief executive of Bookham, told TSC at an investors conference in London last week that when Bookham was founded 12 years ago "the use of silicon in optical chips looked physically impossible, but our technology is a poke in the eye of those who said it was not possible." Bookham finds itself in a market with enormous potential. The consulting group Ryan Hankin Kent forecasts that the compound annual growth rate for fiber-optic components will be 41% through to 2003, when it should reach $21.3 billion, compared with the $5.5 billion it was worth in 1999. Bookham's list of clients includes Nortel Networks and Lucent Technologies. Rickman says investing in Bookham is "not for the faint-hearted," since the company has large upfront capital requirements. In the first quarter, Bookham spent £3.4 million on capital equipment. Yet there appears to be no shortage of investors who are prepared to buy into the story. The stock closed Friday at £39.69, up 297% since the company listed in April, and is trading at about 175 times forecast 2000 sales. The experience of the U.K. Internet auction site QXL.com -- which will release its fiscal first-quarter results ended June 30 on Thursday -- couldn't be more different. At the investors' conference, a figure slipped into the lunchroom and stood at the back listening intently while Meg Whitman, CEO of eBay (EBAY:Nasdaq - news) was speaking. The man with the slightly worried expression was Jim Rose, the CEO of QXL. And worried he should be. In the fiscal year ended March 31, revenue increased 170% to £6.9 million, compared with £2.5 million the previous fiscal year. However, the operating loss ballooned to £32.8 million from £2.1 million. QXL's shares have fallen 994% since their high in March to close Friday at 68 pence. Much of that can be blamed on the daft 333 1/3 price-target slapped on the company in April by SG Cowen, which saw the shares rise 132% in one day. Yet investors are still concerned about QXL's expensive and risky strategy of buying its way into Europe through the acquisitions of Germany's Ricardo and Scandinavia's Bidlet. "QXL's strategy is fundamentally different to that of eBay," explains Derek Brown, analyst at Robertson Stephens. "While eBay has identified the high-growth markets and then established itself in these, QXL has chosen to expand via large acquisitions." As a result "QXL has got enormous complications because of different cultures [between the companies] and trying to establish a cohesive brand," Brown says. Brown has a buy recommendation on QXL. (Robertson has had an investment banking relationship with QXL.) In an interview with TheStreet.co.uk on Friday, Rose said he feels that the European market is big enough for two players, though definitely not three. On a merger with eBay? "Who knows if that is going to happen," says Rose. Who knows, indeed, but no doubt some QXL investors may be hoping it will.