03/12/04: Market Monitor-Robert Morrow, Editor of the "Institutional Advisory Service"
PAUL KANGAS: My guest market monitor this week is Robert Morrow, Editor of the "Institutional Advisory Service" and publisher of the monthly market letter entitled "The High Tech Growth Forecaster." Great to have you back on NIGHTLY BUSINESS REPORT, Bob.
ROBERT MORROW, EDITOR, INSTITUTIONAL ADVISORY SERVICE: Great to be back, Paul.
KANGAS: Was the nasty sell-off in this week's first four days a major market downturn, the beginning of one of those, like a bear market? And was the reflex rally today just a short-term situation?
MORROW: The correction we've seen over the last few days is a correction from the minor peak. I think this is going to carry it down to 9,664 on the Dow, 1,831 on the NASDAQ Composite and 1,042 on the S&P 500. That was just a reflex rally.
KANGAS: So we're still in a bull market, according to you?
MORROW: Absolutely.
KANGAS: All right. Now how, you use some types of cyclical patterns to determine this.
MORROW: Right. It's a combination a combination of cycles and pattern recognition. I call it intense directional determinant. IDD is my model that I use for everything.
KANGAS: Well, you are by trade a very accomplished patent holder, actually, and a lot of aeronautical patents, is that not true?
MORROW: Right, all to do with vibrational analysis.
KANGAS: And you feel the market does the same thing?
MORROW: It goes in cycles.
KANGAS: Predictably?
MORROW: Predictably, yes.
KANGAS: Well, the last time you were us on August 29 of 2003, you were steadfastly bullish, and correctly so. The market was well up from where you thought it would be. As a matter of fact, you weren't bullish enough.
MORROW: True.
KANGAS: But the recommendations you gave our viewers, five of them, did very well. Let's have a look at how they did. Advanced Micro Devices (AMD) up 33 percent from $11 to $15. International Rectifier (IRF), a more modest gain of 8 1/2 percent. I think you had five recommendations all told. Symantec (SYMC), look at that gain, 55 1/2 percent. Automatic Data Processing (ADP) up 5.4 percent. And there was one other, National Semiconductor, which just recently has done well. And it was up -- it's up 39 percent from where it was when you recommended it. Do you still own all of these?
MORROW: The only two that I'd suggest holding would be ADP, Automatic Data Processing and Symantec.
KANGAS: OK. Well, congratulations on five great recommendations, in any case.
MORROW: Thanks, Paul.
KANGAS: And, also, congratulations on your being the cover story in this month's "Timer Digest."
MORROW: Thank you.
KANGAS: Now, new recommendations.
MORROW: New recommendations. OK, the first one would be Apple Computer (AAPL). I think they're the premier personal computer stock.
KANGAS: OK.
MORROW: The second one would be AutoDesk (ADSK).
KANGAS: OK, let's get that chart up there.
MORROW: That would be software for industrial design. Genentech (DNA) would be the third recommendation, of course, biotech.
KANGAS: They're all on strong up trends. That doesn't bother you?
MORROW: Not at all. Buy on strength.
KANGAS: OK.
MORROW: The next one would be First Data (FDC) commerce calculations.
KANGAS: This one's had a little more travail in the recent months, I see.
MORROW: That's true, it has.
KANGAS: Yes.
MORROW: Then, finally, Qualcomm (QCOM), anything to do with cell phones, cellular radio. They're the premier play in that area.
KANGAS: Right. Do you own any of these stocks personally?
MORROW: No, I buy the indexes due to a conflict of interest in buying the individual stocks.
KANGAS: The exchange traded funds where you have a basket of stocks?
MORROW: A basket of stocks.
KANGAS: Some of these included, is what you own?
MORROW: Absolutely.
KANGAS: Yes. Why are you so bullish?
MORROW: Well, I think the bull market is going to extend on into October this year. That will be the end of the bull market. The numbers I'm looking for on the Dow are 12,615; the NASDAQ Composite 2,378; and the S&P 1,345. That's the end of the bull market, in my view.
KANGAS: But still pretty good vibes, pardon the expression.
MORROW: Exactly.
KANGAS: Yes. Excellent, indeed. So, anyway, we have time to enjoy some more gains on the long side of the market?
MORROW: Oh, yes, absolutely.
KANGAS: All right. And this is all based on your technical analysis?
MORROW: Right, cycles and --
KANGAS: Fundamentals aren't too important to you at this stage?
MORROW: I read them, but I don't use them.
KANGAS: OK. Fair enough, Bob. We'll be watching these new recommendations closely and hope they're as successful as your past recommendations.
MORROW: Thanks a lot, Paul.
KANGAS: Thanks very much for being with us. My guest, Bob Morrow of the Institutional Advisory Service.
Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2004 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED.
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