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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (26904)	8/3/1998 6:09:00 AM
From: Gameboy	Read Replies (3) \| Respond to of 95453

"OSX could drop another 10-20% by October" I don't know what oil service sector stocks you're following, but most of the ones I've been watching are oversold and underpriced unless their forward looking earnings for the next year fall by at least 50%. Most earnings estimates have already been lowered but to nowhere near 50%. With oil prices rising, and with OPEC prepared to make more cuts if necessary (by October?), I doubt if many analysts would now slash earnings estimates. I believe the overall stock market would be vulnerable if it perceived oil prices to be climbing rapidly, but if the market perceived oil prices to be climbing rapidly wouldn't that benefit a vastly oversold oil service sector? When speaking of rising oil prices, we're not talking about prices rising to $30/barrel but only to a 'normal' level of $18-22/barrel under which the oil sector is reasonably stable. At $18-22/barrel the replacement rate of oil capital tends to balance natural attrition; $14-$15/barrel is not sustainable for any length of time unless OPEC floods the markets because only the OPEC producers possess the capacity for such overproduction. OPEC is making it clear they don't plan on overproduction. Best of luck, Steve