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.

Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Chispas who wrote (39107)	10/13/2005 4:07:13 AM
From: Chispas	Read Replies (1) \| Respond to of 116555

Outlook For The Tech Sector : PAUL KANGAS: Another disappointing day for technology stocks. The NASDAQ composite lost 23 points. For the year the NASDAQ is down more than 6 percent. Many analysts still predict a rebound before the year ends. But as Scott Gurvey reports, others suggest investors need to realize the nature of tech companies has changed. SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: Hope springs if not eternal then at least perennial for tech stocks and many analysts back in January forecast a continuation of a NASDAQ rally which began in last year`s final quarter. It was not to be. The NASDAQ Composite index is down more than 6 percent since the start of the year and it remains more than 55 percent below the record it set way back in the year 2000. Part of the problem is that some of high tech`s biggest success stories are not translating into big profits. For example, competition for large television screens has become positively cut-throat. Margins on all but the most sophisticated and expensive models of personal computers have shrunk into the single digits. Biotech companies are having a difficult time bringing new products to market. But beyond that, markets watchers say, is simple fear. Investors are worried. JAMES AWAD, PORTFOLIO MANAGER, AWAD ASSET MANAGEMENT: People are worried about the economy. They`re worried about interest rates. They`re worried about energy prices. They are spooked by the way the Fed is speaking aggressively on inflation and interest rates. And the fear is that the combination of interest rates and energy prices will slow the economy dramatically in `06. Therefore businesses will not spend on technology and capital investment and therefore the stocks aren`t going to do well. GURVEY: There is little agreement on where tech stocks will go from here. But some suggest the NASDAQ composite is no longer a proper proxy for high growth innovative companies because it is dominated by maturing giants like Microsoft and Intel. PIP COBURN, CEO, COBURN VENTURES: Of the thousand companies I really care about, there might be 50 that you`d say are tech stocks per se. The rest are big companies that are struggling along with whatever content they have. There are plays like blackberry. There`re plays -- Apple`s a tech stock. There are tech stocks but there`s not many of them. GURVEY: Market watchers suggest investors pay close attention to the forward looking statements tech companies release along with their third quarter earnings reports. That guidance should help determine the direction of the NASDAQ in the months ahead. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York. ............................