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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (45944)	1/8/2002 1:36:41 AM
From: stockman_scott	Respond to of 65232

General Commentary on the Tech Sector From Briefing.com--- One of the big surprises regarding the rally in tech is its timing... Though sector was helped by January-effect buying, fact that stocks have maintained a bullish bias during warnings season has caught many investors by surprise... The reason for that is simple, most recent quarters have been filled with numerous negative shocks that triggered broad-based retreats. So what's different about this quarter? For one, the number of warnings is down from previous quarters... Though warning season runs for another week or so, to date only 184 companies have guided estimates lower... We say "only" because that's considerably fewer than the number of warnings over the past several quarters (Q301/357, Q201/388, Q101/460)... Second, the street finally caught up with the economic/earnings picture so expectations are more in line with reality... Which brings us to point number three -- virtually no big, sector/market moving shocks... Finally, and this is very important, the number of positive preannouncements currently sits at 92 - the highest number in over two years. What these numbers suggest is that the sector has bottomed... When you consider that consensus estimates tend to lag noticeably during transition periods, as long as economy doesn't roll back over, we should see a further convergence of negative and positive surprises in the quarters to come... And that's good news on two fronts: 1) estimates and ratings are likely to trend higher and 2) concerns over excessive valuations are being overstated. - Robert Walberg