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 : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: Jan Crawley who wrote (20637)	8/15/1998 7:10:00 PM
From: Mang Cheng	Respond to of 45548

This portion from Barron talks about the current general market condition : "So, are we near a bottom? We put the question to one prominent fund manager, who admitted to fears the market will see a further 20%-25% drop, which would bring the Dow down to the region of 7000-7500. "I don't think the Asian negative will derail our economic growth, but it won't go away, and it will get worse over time," frets our shy, bearish friend. "At the bottom, you typically get climactic activity, with high volume, and a put/call ratio above one. I don't see the put/call buildup, the panic, the cash." Richard Hoey, the chief economist at Dreyfus, notes a divergence in how the high-profile market gurus assess the outlook for stock prices. "What fascinates me is the debate between the technicians and fundamentalists," Hoey says. "A majority of the fundamental strategists look at cheaper stock prices and reiterate their positive stance -- Abby Cohen, Edward Kerschner at PaineWebber, Thomas Galvin at DLJ, Jeffrey Applegate of Lehman Brothers. They all make the case that fundamentals remain the same, or at least not that different, and that the risk-reward ratio improves as prices come down." The Dow fell another 173 points last week, to 8425, and now stands 9.8% below its July peak. The index would be even lower had it not been for a rumor-driven 9 and one-eighth point surge by JP Morgan on Friday. On the other hand, Hoey points out, many prominent technicians, including Ned Davis, Justin Mamis, Ralph Acampora, Salomon Smith Barney's Alan Shaw, and Bob Farrell and Dick McCabe of Merrill Lynch, have become increasingly concerned over the course of recent weeks. "They see a narrowing of the market, the broad market weakening even as the senior averages made new highs," he says. "The question for them is, have we already completed the process? Is it a forecastable trend for the future, or simply a recognition of what has already taken place?" So, who has it right? In a way, both, Hoey argues. The technicians, he notes, have given a fair description of what's been occurring. The fundamentalists don't say the market should not have come down, but that returns will be reasonable for the next year, now that stocks have been adjusted downward. Adds Hoey, "I tend to fall with the optimists on inflation and interest rates. My primary concern is that the bulls don't have it right on corporate profits, Asia, and the slowing of the U.S. and world economies." interactive.wsj.com Mang