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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Daflye who wrote (8202)	3/15/1999 11:26:00 AM
From: Gersh Avery	Read Replies (1) \| Respond to of 99985

Maybe if we got behind it and pushed a little harder!! But then .. what happens when we get to the top of the hill?? Gersh <G>

To: Daflye who wrote (8202)	3/15/1999 11:35:00 AM
From: Les H	Respond to of 99985

Dow's 10,000 Campaign Lacks Coat-Tails By Richard Melville NEW YORK (Reuters) - The Dow Jones industrial average's run for 10,000 may prove that at least on one level the bull market party is still going, but the guest list for the long-running affair is shrinking. A performance gap in the market, noticeable in a widening disparity between the Dow and broader market indicators as well as an increasing number of stocks falling behind as the indexes climb, is drawing increasing attention on Wall Street. Financial stocks also could attract investors interest this week after BankBoston and Fleet Financial Group announced a $16 billion merger deal Sunday. The deal could raise renewed speculation on Wall Street speculation about further U.S. bank consolidation, analysts said. The hard truth of the 1999 stock market, at least through last week, is that most people have not realized the kind of profits suggested by the Dow's headline-grabbing gains, which stood at 7.8 percent for the year through March 11. The Standard & Poor's 500 index was up 5.6 percent over the same period and the broader New York Stock Exchange composite just 2.7 percent. ''Yes, we're probably going to 10,000 but this rising tide is not lifting all boats,'' said Hugh Johnson, chief investment officer at First Albany. ''And that kind of divergence is very troubling.'' The Wilshire 5000 index, which some consider the best barometer of the market because it is composed of all U.S. headquartered NYSE, American Stock Exchange and Nasdaq stocks (more than 7,000 in all), was up just 4.2 percent, according to Wilshire Associates. ''This means most investors are not reaping the benefits suggested by the Dow's performance,'' said Stephen Nesbitt, senior vice president at Wilshire Associates. Nesbitt argued the Dow's rally is ''creating illusions about the market.'' Fresh data on mutual fund support the argument. A review of performance information for the 25 largest U.S. mutual funds provided by Lipper Inc shows only four outgained the Dow through March 11: American Century's Ultra fund at 9.6 percent, Growth fund of America at 8.35 percent, and a pair from Janus, Janus fund at 9.84 percent and Janus Worldwide at 13.26 percent. And according to a report by Salomon Smith Barney, three out of four stocks in the S&P 500 index are actually trailing the performance of the index itself by 15 percent or more over the last year. The measure, which Salomon Smith Barney calls its laggards indicator, reached 75.3 percent on March 9, an all-time high. The figures suggest an ongoing trend in the market away from classes like small caps or value stocks in favor of blue chips and technology may be intensifying. Not everyone draws the conclusion that the data are troubling, or that the market's health is suspect, however. Indeed, some say a broadening is the logical next step and as long as the bull is still alive, some balance will soon be restored. ''We are where we've been in each of the last four years,'' said Bernie Schaeffer, chairman of Schaeffer's Investment Research. ''That is to say that expectations on Wall Street have underestimated both the market and economic growth.'' He said some re-balancing is already occurring, though not all in an investor-friendly fashion. Tech stocks have had a spotty recent showing amid signs of sluggish personal computer sales. More recently, some of the most serious damage was inflicted on Oracle Corp after the database software company reported results that failed to meet Wall Street expectations. ''I feel like the market may be going through something a little bit more than a minor swing, with a rotation maybe out of the techs,'' Schaeffer said, with money going ''perhaps next to areas like retailers or some autos.'' One area Schaeffer is not giving up on is the Internet, despite the already rich prices. ''I do not feel it's all over as far as the Internet goes and I think that will continue to outperform tech as a whole,'' he said.