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Technology Stocks : Intel Strategy for Achieving Wealth and Off Topic -- Ignore unavailable to you. Want to Upgrade?

To: Sonny McWilliams who wrote (26768)	1/31/2001 6:09:32 AM
From: William Hunt	Read Replies (1) \| Respond to of 27012

Thread ---Good morning ---from briefing.com: It's Fed day! Recent data suggest that Greenspan & Co. will cut the funds rate by 50 basis points - the first time the Fed has strung together back to back 50 basis point cuts in Greenspan's tenure as Chairman... If the Fed does cut the funds rate by 50 basis points, it will tell us two things... First, that they were slow in reacting to the economic slowdown and should have been cutting rates sooner... Second, and more importantly, the economic slowdown is more serious than anyone thought just a few weeks ago... And that's potentially bad news for the market and the sector. Techs have rallied in the face of discouraging earnings news on the assumption that the economic slowdown will be short and shallow... However, if the data remain weak investors will begin to question this assumption... As they do they are likely to adopt a more defensive investment strategy... And that means money a) rotating back out of techs and into health care, foods, pharmaceuticals, tobacco, etc and/or b) staying on the sidelines. We aren't at that point yet... At the moment, most investors still expect a second half recovery... Consequently, the current uptrend is likely to continue over the near-term... However, with the Nasdaq up 25% from its 1/3 low and within 6% of our initial price target of 3000, now might be a good time for some light profit-taking... Especially since the next FOMC meeting (and probable rate cut) isn't until 3/20... PC, Chip Equipment, Storage and Net stocks among those most at risk to a change in investor sentiment. Any pullback that does occur will be relatively modest, as shorts won't get aggressive with the Fed in an accommodating mood... Even so, if buyers go on strike, the Nasdaq could spend an extended period (couple months) stuck between 2900 and 2600. BEST WISHES BILL