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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: AD who wrote (119273)	12/18/2000 10:58:37 AM
From: Lane Hall-Witt	Respond to of 120523

Aqua -- CSCO: Good point! And look how they're shredding it today. There was sure a load of selling into the gap. What caught my attention with that Bloomberg report, and especially the CNBC report at the end of the day on Friday, was that as usual they totally missed the reason for that session's volatility in CSCO and the Nasdaq. It probably wasn't the Bloomberg report, which wasn't a big deal until CNBC pounded the table on it. The reason CSCO sold off was the rebalancing of the Nasdaq 100, where a number of small companies (such as LGTO) were removed and a number of larger companies (such as EXDS) were added. This had the effect of making CSCO -- and ORCL, SUNW, INTC, etc., etc. -- into a slightly smaller percentage of the Naz 100, which ushered in across-the-board big-cap selling into the close. All of that said, I totally agree with you about the subtle fundamental clues that can indicate troubles down the road. As fundamental analysis, the Bloomberg report was useful because it identified a factor that could grow in importance over time. CNBC's report on why CSCO was trading as it was, though, was off the mark, because that Bloomberg news had been factored in at least a month ago. Of course, now CSCO is trading on the Bloomberg news because CNBC made it a part of the game for speculators. Funny world!