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

To: NickSE who wrote (12661)	5/3/1999 4:21:00 PM
From: Giordano Bruno	Read Replies (2) \| Respond to of 99985

Buffett on Nets... In a television interview, billionaire investor Warren Buffett sounded something of a cautionary note about Internet stocks. In the interview on CNBC's ''Squawk Box'' program, Buffett noted ''enormous speculative activity'' in Internet stocks. He said investors would be disappointed with the prices they were paying for most issues. Internets extend losses, profit-taking seen By Ian Simpson NEW YORK, May 3 (Reuters) - Internet shares extended losses Monday afternoon, driven lower by profit-taking in the high-flying sector. Continuing a recent drop, the American Stock Exchange's 50-stock index of Internet stocks (.IIX - news) was off 12 points, or 3.5 percent, at 320 points. The gauge fell 7 percent last week from its closing high April 26. Analysts said investors were cashing in on phenomenal gains. Even with last week's loss, as of Friday's close the index was up 207 percent in a year. ''Personally, I view this as a correction after a very, very strong run,'' said John Mendelson, head of market analysis at Schwab Capital Markets. He said the Internets also were being hit by a switch away from technology shares into so-called cyclical stocks, including such workaday sectors as commodities, metals, autos and paper. Momentum traders, or short-term investors who buy stocks when they are rising and sell when they start to drop, also were whipsawing the sector. ''Every once in a while stocks have to rest, even IBM,'' or International Business Machines Corp. (IBM - news), said Arnie Owen, managing director of Cruttenden Roth in Newport Beach, Calif. In a television interview, billionaire investor Warren Buffett sounded something of a cautionary note about Internet stocks. In the interview on CNBC's ''Squawk Box'' program, Buffett noted ''enormous speculative activity'' in Internet stocks. He said investors would be disappointed with the prices they were paying for most issues. ''But any booming industry attracts capital,'' he said. ''And, you know, the two boomers for the first half of the century were the automobile industry and ... aircraft, and very few people ended up making money out of those industries.'' Among active Internet issues, retailer Amazon.com Inc. (AMZN - news) was off 17-15/16 to 154-1/8. The shares have fallen 27 percent since April 23, hurt in part by the company's forecast of deeper losses for the next two years. Barron's reported over the weekend that 75 of nearly 200 portfolio managers polled by the financial newspaper rated Amazon.com as the market's most overpriced stock. RealNetworks Inc. (RNWK - news) dropped 16 to 205-1/2 after the Internet media company said it and AT&T Corp. (T - news) launched a digital music platform for the Internet. Service provider America Online Inc (AOL - news) slipped 7-3/4 to 135. Among other market indexes, the Dow Jones gauge of electronic commerce shares (.DJECOM - news) was off 5.5 percent. The Dow Jones index of Internet service stocks (.DJISVC - news) fell 4.13 percent.