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Strategies & Market Trends : Trend Setters and Range Riders -- Ignore unavailable to you. Want to Upgrade?

To: SusieQ1065 who wrote (1634)	6/17/2001 7:22:23 PM
From: Susan G	Respond to of 26752

More Warnings to Mar Mood Jun 17 5:17pm ET By Elizabeth Lazarowitz NEW YORK (Reuters) - Wall Street is in for more pummeling this week with no relief in sight from the steady drone of corporate profit warnings and signs the U.S. economy is sputtering. The Nasdaq market had its worst week of the year last week as a barrage of companies announced they were still feeling the pinch from the economic downturn, raising fears it may take even longer than expected to turn profits around, and analysts say there is probably more to come. "Companies like Cisco might come out and warn again for the nth time," said Stanley Nabi, managing director at Credit Suisse Asset Management, which oversees about $110 billion. Worries about more bad earnings news and doubts about economic recovery will cast a pall over Wall Street for at least the next two weeks until the corporate confession season -- when companies fess up to weaker profits -- winds down, Nabi said. "Three or four weeks ago, the perception was that in the second quarter we would have seen the worst, but what I think is likely to happen is the third quarter will be bad, also," he added. Wall Street's premier investment banks, including Goldman Sachs and Morgan Stanley , will issue their quarterly results. That will give traders an indication of how securities firms are weathering the ongoing stock market slump. Tech investors will focus on software maker Oracle Corp. , which is expected to release its corporate scorecard on Monday. Few other earnings reports are expected. FED'S GREENSPAN IN THE SPOTLIGHT The spotlight will fall on Federal Reserve Chairman Alan Greenspan mid-week when the top central banker is scheduled to speak on "The Growing Need for Skills in the 21st Century" before the U.S. Labor Department's national summit on the 21st Century Workforce at 8:45 a.m. EDT (1245 GMT) on Wednesday. Hopes that the Fed's five aggressive interest rate cuts so far this year can help rejuvenate the economy have underpinned the market, and investors will be listening carefully for clues to just how much further the central bank is willing to go. The Fed is widely expected to lower rates another quarter of a percentage point at its next policy-setting meeting on June 26-27, but the steady stream has heightened expectations for another half a percentage point cut. "We still have a very weak economy. That's the bad news," said John Manley, chief equity strategist at Salomon Smith Barney. "The good news is it's an economy that's needs more help from the Fed, and it's an economy that will get more help from tax cuts." Last week, major stock market indexes dropped to seven-week lows amid a drumbeat of warnings of weaker results in the latest quarter from such marquee names as telecommunications gear maker Nortel Networks Corp. and fiber-optic heavyweight JDS Uniphase Corp.. For the week, the Nasdaq composite index<.IXIC> fell 8.4 percent, the Dow Jones industrial average <.DJI>dropped 3.2 percent for the week and the S&P 500 <.SPX> slipped 4 percent. So far this quarter, 498 companies have said their earnings would be disappointing, dwarfing the 132 companies that said they would be on target and the 138 said they would be better than expected, according to market tracker Thomson Financial/First Call. That's at least a fivefold increase from the number of companies that warned of bad news last year at this time. On the bright side, the number of negative pre-announcements is close to even with the 518 companies that had warned about their earnings at this point last quarter, First Call said. Although it may be too early to expect a lot of positive news out of corporate America, investors are hoping for at least a slowdown in the number of profit warnings, Salomon Smith Barney's Manley said. Along with Goldman and Morgan Stanley, top Wall Street investment firms Bear Stearns and Lehman Brothers will issue earnings reports this week. DATA TO LEAVE STOCKS COLD The stock market has been stuck in a narrow trading range since mid-April, and analysts say Wall Street needs to see clear signs that the economic picture is clearing before the market revs up again. This week's economic data, however, are not expected to give traders much encouragement. Housing data is on tap, with the National Association of Home Builders' (NAHB) scheduled to release its monthly U.S. home builders' sentiment index on Monday, and the government set to issue May housing starts data on Tuesday. Traders may also glance over federal budget data for May due on Wednesday and April international trade data on Thursday. Weekly jobless claims will be in the spotlight again on Thursday as analysts search for further signs of weakening in U.S. labor markets amid a slew of corporate layoff announcements in recent months. "Whatever economic figures come out next week, they'll merely confirm the deterioration in the economy," Nabi said. siliconinvestor.com