Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (15046)	5/8/2004 9:35:09 PM
From: Donald Wennerstrom	Read Replies (1) \| Respond to of 95888

A little bit of "forward looking" for possible market action next week. <<Stocks set for another choppy week But earnings prospects could trump rate, inflation fears By Mark Cotton, CBS.MarketWatch.com Last Update: 4:48 AM ET May 8, 2004 NEW YORK (CBS.MW) -- U.S. stocks are poised for another week of choppy trading as a rosy outlook for earnings growth on the back of a robust economy battles with investor concern about inflation and higher interest rates. With the Federal Reserve signaling last Tuesday that it will raise interest rates at a "measured" pace, the stage could be set for rebound in equities, according to several market professionals. "The people who are the most worried about when the Fed's going to raise rates have already done some selling," said Alfred Kugel, senior investment strategist at Stein Roe Investment Counsel. "Some of the longer-term buyers will say the prices are pretty reasonable and they should do some buying next week." [snip] <<Joseph Keating, chief investment officer at AmSouth Asset Management Group, said equities will draw their strength in a higher rate environment from the current performance of the U.S. economy. "The good news is that the economy is in solid shape and should survive a mild interest rate cycle for an extended period if no significant financial accident occurs," said Keating. "The advance in common stock prices should continue, driven by the durability and growth of earnings." Over at BMO Nesbitt Burns, senior economist Russell Sheldon said stocks had history on their side. Sheldon said the Federal Reserve raised rates by three percentage points in 1994, when the U.S. economy was at an early stage of its expansionary cycle and "profits surged into double digits and stayed stronger than GDP growth for four years." "This set up the bull market of the 1990s and there's no reason it won't happen again," said Sheldon. Sheldon said any significant sell-off in equities on the strong economic data represents "a buying opportunity for investors.">> [snip] <<Among other earnings reports likely to focus investor attention, Cisco Systems (CSCO: news, chart, profile) reports its fiscal third-quarter earnings on Tuesday after the market close. Merrill Lynch analyst Tal Liani is expecting the networking giant to post adjusted earnings of 18 cents a share, in line with the average estimate of 40 analysts polled by First Call. Liani said the company will benefit from strong sales of switches and enterprise-class routers. Merrill Lynch currently rates Cisco a "buy" with a $29 price target. Staying in technology, investors will be looking for Dell (DELL: news, chart, profile) to surprise on earnings after it lifted its first quarter revenue forecast in April to $11.4 billion from $11.2 billion. Goldman Sachs analyst Laura Conigliaro is forecasting earnings of 28 cents a share, in line with First Call estimates. Conigliaro said the recent outperformance of the company's stock reflects investor anticipation that it will report a profit a penny ahead of estimates. "If Dell decides not to show an extra penny this quarter, the stock could briefly sell off. Either way, we would be buyers," said Conigliaro in a note to clients previewing the company's results.>> [snip]