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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: satish kamat who wrote (27776)	12/12/1997 3:25:00 PM
From: Sector Investor	Read Replies (2) \| Respond to of 61433

For your reading pleasure while we wait for the 'BIG' news: =POINT OF VIEW: Week's Stock Losses Show Resurgent Asia Woes Dow Jones News Service via Dow Jones By Neal Lipschutz A Dow Jones Newswires Column NEW YORK (Dow Jones)--The United States may be the world's only remaining superpower, but that doesn't give it a free pass from economic sufferinginflicted from abroad. And increasingly, the current problems from beyond the U.S. borders don't looksusceptible to a quick brush-off. Not that Wall Street hasn't tried. Exhibit A is the performance of U.S. stocks in the week ended Dec. 5. That is not ancient history. That is one week ago. Somewhow the skies were brighter then. The International Monetary Fund was in the ascendancy, an agreement with ailing South Korea, by far the largest of the Asian economies in distress, was in hand. Japan was acting purposefully. In the oversimplified way that large, complex issues are translated into a rough up or down direction for a broad market, Asia appeared to be "solved." That sanguine assessment unraveled in a hurry. The Dow Jones Industrial Average climbed 326 points in the week ended Dec. 5, more than 4%. The Standard & Poor's 500 index set a record on Friday, Dec. 5. This week, that 326-point gain in the DJIA has just about been wiped out. What happened? Asia came back. Well, it's not that simple. Among the rash of U.S. companies (many in high-tech) pre-announcing gloomy fourth quarter financial results were some that have little or no exposure to Asia. Their bad news is just bad news. Asia did figure prominently in other U.S. corporate announcements. What had in October been a market phenomenon was now for American companies an economic reality, in black and white in the press releases and Securities and Exchange Commission filings the companies were obliged to issue. The larger, looming issue for U.S. equities markets is not the earnings hit to be taken by companies with significant exposure to Asia, the delayed opportunities for growth in that region or the varying estimates about how much chaotic Asian financial systems and stunned economies will reduce growth in the U.S. gross domestic product. The big question that took a week's vacation but is now back as big as ever is where does this end? A closely linked question is how does this end; how does South Korea start to put itself right, to regain some semblance of investor confidence? When the U.S. stock market took its big drop in late October, there was much talk about how stocks had been priced for a "perfect" world of continued corporate earnings growth and low inflation. That perfection, it became clear, had taken a significant hit. Last week, with IMF deals in place throughout the region, Wall Street was eager to believe it could turn inward again, that Asia had been "fixed." Things might not be "perfect," but they were close. Events in South Korea in the past week, with the currency and stock markets there falling daily, with mixed signals from the government on the eve of an election, with debate about whether the IMF package is big enough, with the Korean economy in turmoil, make it clear that for corporate and investing America, this is not a problem that is quickly going to go away.