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Strategies & Market Trends : Fidelity Select Sector funds -- Ignore unavailable to you. Want to Upgrade?

To: mrc who wrote (751)	3/18/1998 11:24:00 AM
From: Bernie Kaplan	Read Replies (2) \| Respond to of 4916

Construction has been favorably positioned for more than a month, and the fundamentals for this sector have been improving quite a bit lately. Lower interest rates obviously help homebuyers and the lending requirements of builders, lower paper and lumber prices also help to moderate costs, and recent merger activity in the concrete business has given the fund an additional boost this week. Usually a neglected Select Fund, it has done very well this year and is currently generating the fourth best composite momentum in the family. Where Energy Services is concerned, the fundamentals have not changed at all but we are seeing some bottom fishing at support levels this week. This helps long time sufferers to recoup a bit of their losses, but this fund is still a long way off from establishing a convincing and sustainable uptrend as opposed to its intermediate five and six days runs it has put together this year. As depressed as this fund is, waiting for a genuine uptrend will still hold plenty of upside potential, so impatience at every breath of life is not necessary and could result in a serious case of whiplash if this fickle sector plays its tricks on you again. It would not surprise me, however, if this fund turns into one of the top performers in the family during the second half of the year, but much depends on oil prices and there is little longer term relief in sight right now. Bernie Kaplan www.sectorfunds.com