LG...Pundit Central
6 P.M. EST -- MONDAY -- FEB. 8, 1999
FROM THE BULLS:
"Our cycles call for some sort of a short-term low in the Dow near Feb. 8 -- plus or minus two days -- and then the start of a big rally," says JERRY FAVORS, editor of "The Jerry Favors Analysis" in Columbus, Ohio. "So we're probably going to start doing some buying sometime early [this] week." However, he cautions that even the slightest tick below Friday's lows "is going to signal lower prices and it will also signal a probable test of 9,146 intraday in the Dow Jones." (CNBC "Street Signs", 2/5)
"Yes, valuations are high, but they've been high and taking money out of the market because of high valuations has not been a money-making proposition," says TIM MORRIS of BESSEMER TRUST. (WSJ, 2/8)
FROM THE BEARS:
"I think for the year, you're going to find the market up a little or, more than likely, down a little, because I think you still have the Asian weakness to be factored in and I expect the U.S. consumer to pull in its horns just a little bit as the year goes on," says VINCE FARRELL of SPEARS, BENZAK, SALOMON & FARRELL. "Therefore, you have some difficulty generating corporate profits. But I don't think interest rates are going to go up significantly from here, so the valuations will stay high. But it's time to have a consolidation because we've had four such good years. So I expect the market to be off slightly on the year." (CNN "Moneyline", 2/5)
"I think the market is entitled to a little rest here and by going [from bullish] to neutral I guess I'm trying to say that while there may be some downside, it's not a big deal, it's just that we shouldn't be looking for new highs anytime soon," says CHARLES BLOOD of BROWN BROTHERS HARRIMAN. "At the minimum I think we're looking at 3 to 5 percent down, maybe a little bit more than that -- a very typical bull market type consolidation or correction." (CNBC "Market Wrap", 2/5)
"I think the top 50 stocks are going to have a correction," says LOUIS HOLLAND of HOLLAND CAPITAL MANAGEMENT. "I believe most stocks last year already had their bear market." ("Wall Street Week", 2/5)
"The parabolic moves in many of the megacap tech stocks, not to mention the Internet group, indicate that a severe correction, rather than a 'healthy pullback,' is likely," says WILLIAM MEEHAN of CANTOR FITZGERALD. (WSJ, 2/8)
FORECASTS AND PREDICTIONS:
"I think the Internet is going to pound its way down past the PC and television into all kinds of devices like the cellular phone, your personal digital assistant or your pager," says PAUL COOK of the MUNDER NETNET FUND. "I think, too, you'll find it in the home at some point." (CNBC "Street Signs", 2/8)
"After this pullback has run its course, I say Nasdaq and technology stocks and Internet stocks are going to run upwards for many years to come," says LAWRENCE KUDLOW of AMERICAN SKANDIA. "That's how long this revolution is going to last." (CNN "Moneyline", 2/5)
STOCK MARKET:
"There's plenty of room here for downside weakness in the short term, but on the long-term it's probably a positive feel," says JOSEPH CANGEMI of FRANCIS P. MAGLIO. "Over the weekend I think we had more positive than negative talk about the technology sector so I think [investors] came in Monday morning looking to get back involved in these stocks." But he says negative comments by some market strategists "kind of put a damper on the fire" and tempered technology buying. "There's no doubt there's money to be invested," he says. "The market has been making some positive moves, but it's just not enough to take it into a real strong rally here." (CNBC "Street Signs", 2/8)
"While the bull market is still intact, it is always a problem when you begin to see the breadth diverge as much as it has," says TIM HAYES of NED DAVIS RESEARCH in Tampa, Fla. "We put a lot of emphasis on breadth and even within the technology area ... we're seeing a steady deterioration in breadth. ... We've seen a steady expansion of new lows relative to new highs, which means
there's very poor underlying health within the OTC market." (CNBC "Street Signs", 2/8)
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