Pundits Central
STOCK MARKET:
"Right now we need a little more direction," says PETER HENDERSON of HENDERSON BROTHERS. "It looked like the market was poised to take off again [Monday] and in the past we've seen that the momentum carries stocks higher. Once they get a direction, they really seem to take them to a higher level. It's just simply not happening right now. I think we lead some leadership and I think it will come from the techs." He says he would be surprised to see the Dow trade below 9000 in the short-term. (CNBC
"Street Signs", 3/1)
"It's a nervous market where when there is a little bit of strength sellers come in and sell because they say this is not going to continue," says GEORGE DAGNINO of PETER DAG & ASSOCIATES. "But then again, there are people who say some sectors have been beaten up quite a bit so this is the time to buy. So you have this back and forth, back and forth." (CNBC "Market Wrap", 3/1)
"What's happening is you're having just a mild bout of rotation -- people taking profits in the tech group and moving some of the money, some of the hard-earned profits, into the blue chips," says GRAHAM TANAKA of the TANAKA GROWTH FUND. (CNBC "Market Wrap", 3/1)
"I think the market's resilience in the face of higher [interest] rates in the last week or so indicates that the market at this point is really starting to look for earnings and I think we will see earnings growth this year," says ELIZABETH MACKAY at BEAR STEARNS. (CNBC
"Market Wrap", 3/1)
"The demand environment [for personal computers] is less than robust today, but not significantly different from what we saw two months ago when these stocks were trading up, or for that matter, back in October when folks couldn't sell technology stocks fast enough," says KURT KING of NATIONSBANC MONTGOMERY SECURITIES. (CNBC "Market Wrap", 3/1)
"We're still very much in favor of the larger cap, higher quality guys -- the guys that have certain earnings, as opposed to cyclical earnings," says RICHARD BERNSTEIN at MERRILL LYNCH. "If you're going to bet on pricing power, you're betting on cyclicals right now and I just don't think that's the right course." (CNBC "Market Wrap", 3/1)
"Currently the small-cap environment is under stress, mainly for technical reasons," says JAMES MARGARD of the RAINIER CORE EQUITY FUND. "It's a group that has not performed very well over the last year or two. The economic environment and revenue growth is tough out there and that tends to weight a little heavier on smaller cap stocks. Credit available is getting a little better for the companies, the economy is relatively strong and I think gradually the group will begin to outperform." But he cautions that selectivity is key because there will be big winners and big losers. (CNBC
"Street Signs", 3/1)
"I think there's the general perception that this is a consolidating industry -- the Internet broadly defined -- and that we're going to see additional transactions over the next nine months or so and I think that's probably correct," says Internet analyst JONATHAN COHEN of WIT CAPITAL. "So I think that's essentially placing a safety net under the valuations of certain stocks. And with the larger cap names -- the truly liquid Internet companies like America Online, @Home or Yahoo! -- the institutional level of interest is sufficient where these things have a little bit of a live of their own, which I also think is pretty healthy." (CNBC "Market Wrap", 3/1)
"Every time the market goes up, people want to come in and sell," says SCOTTY GEORGE of CORINTHIAN PARTNERS ASSET MANAGEMENT. ("The Washington Post", 2/27)
"It is going to take some time before the market is convinced [the economy will slow]," says MITCHELL HELD of SALOMON SMITH BARNEY. (NYT, 2/27)
"Right now, I think the stock market is where it will be at year end," says EDWARD KERSCHNER of PAINEWEBBER. "The market will move up and down, but if you want to trade this market you either have to be very, very good or very, very lucky." He says that "back in the fall, the odds were 90 percent that stocks would do better than bonds. Now it is about 50-50." (WSJ, 3/1)
"Technology stocks are adjusting because there might be some slowness on the personal computer side," says HENRY CAVANNA of J.P. MORGAN INVESTMENT MANAGEMENT. "The trigger [Friday] was Compaq." ("The Washington Post", 2/27)
"This [technology sector] was one of the more expensive groups in the market, relative to its historical patterns," says CHRISTINE CALLIES of CREDIT SUISSE FIRST BOSTON. "When interest rates start to rise, investors do tend to selectively rotate out some of the more optimistically priced groups and that's what we think is the main problem here." (CNN "Moneyline", 2/26)
"[Technology stocks] have had such a long run, it would surprise me if they don't correct for a while before regaining their leadership role later on," says BUZZ HUSSEY of DAIN RAUSCHER WESSELS. "The companies that can grow are those that can cut costs, make acquisitions, dominate their markets and grow world-wide. One of the phenomenons we're seeing is that the larger companies get, the more profitable they get. And money goes where it's been treated well, and it's been a long time since small-caps have been friendly." (WSJ, 3/1)
"The bullish case is that we are in a strong economy and we think the worst is behind us on the earnings front," says DOUGLAS CLIGGOTT of J.P. MORGAN. He is advising clients to "buy semiconductor stocks on weakness." ("The Washington Post", 2/27)
"With a market that's somewhat overbought, it's not surprising that we've been a little bit on the negative side for the last couple of days," says TED WEISBERG, president of SEAPORT SECURITIES. "Actually, I think the action [Friday] is pretty decent, all things being considered. You would think with all the things going on ... that stocks would be a lot lower. We seem to be locked in a trading range -- 9100 to 9600 -- and I'm actually encouraged by [Friday's] performance." (CNBC
"Street Signs", 2/26)
"We could see a little bit of a bounce [in technology stocks], but I think there's a real cloud over the sector right now," says WILLIAM KEITHLER of the INVESCO TECHNOLOGY FUND in Denver. "The PC industry is very important to other sectors in technology and a great deal of expectation had been riding on the strong first quarter for the PC industry. With that called into question now, you have to readjust expectations. I think we accomplished an awful lot of that [Friday], but the stocks could be under a cloud for a little while." (CNBC
"Market Wrap", 2/26)
"I think what people are going to realize now is that Q1 is going to be seasonal as it always is [for computer companies] -- no better, no worse," says DAN NILES of BANCBOSTON ROBERTSON STEPHENS. "Anybody who was going to buy a high-end Pentium II is probably now thinking about buying a low-end Pentium III. Those systems, you can walk into a store and buy them for the first time [now] and I think it'll take 30 days to sort that out." (CNN
"Moneyline", 2/26)
"I think actually we had a technology correction [last] week that was really based on expectations that were probably excessive," says ELIZABETH DATER of WARBURG, PINCUS ASSET MANAGEMENT. "Some of the bellwether technology companies were selling at about 60 times earnings. I think growth is alive and well, but may be decelerating somewhat and certainly pricing is decelerating somewhat. I'd be getting ready to be a buyer [of technology]. I think it's been the leadership, I think it will continue to be the leadership." ("Wall Street Week", 2/26)
"I don't think there are any signs of serious trouble in the [personal computer] industry," says STEPHEN DUBE of WASSERSTEIN PERELLA SECURITIES. ("Investor's Business Daily", 3/1)
"We think large-cap stocks will continue to deliver earnings and at the end of the day we think [stock] prices follow earnings," says MARK STOECKLE of the COLONIAL U.S. GROWTH & INCOME FUND. ("Wall Street Week", 2/26)
Even though he is 90 percent in cash, ROBERT DRACH, publisher of the "Drach Weekly Research Report" is not looking for a big market collapse "because you already have the undermarket, the widely-based market down. The average is up. You have these high-tech stocks that got all the speculative money up. And they're just getting their spanking long overdue. ... With the stocks depressed, you can get professional buying. ... I'm beginning to look [to buy stocks]." (PBS "Nightly Business Report", 2/26)
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