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.

Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: marc ultra who wrote (29880)	5/3/1999 5:50:00 AM
From: Justa Werkenstiff	Read Replies (1) \| Respond to of 70976

Paul V: Re: " But aren't cyclical stocks promoted as being the beginning of a bull market. This is one reason that that I am confused." When you have the economy growing 4.5% last quarter and commodity cyclical companies being bid up, the market is voting that the economy is hot enough for some pricing pressure down the road. The spurs concerns of inflation as can be seen in the rise in the yield on the long bond. And when interest rates rise, there can be a contraction of the multiple of the high P/E stocks like AMAT. In the coming days, we should be able to gauge to what extent AMAT's correction is due to concerns such as DRAM pricing and to what extent it is due to contraction of the high multiples in growth stocks generally due to inflationary concerns.