Overheard On The Street
Here’s what they’re saying at mid-day
John Roque, Vice President, Arnhold and
S. Bleichroeder: “Of late the Value Line has been as close to perfect as an
index can get. It’s up 8% year-to-date, has risen three days in a row, and gained 12
of 16 days. We’ve highlighted this index a lot since the beginning of the year
and because we’re expecting the VLE to do well we’ve argued for a
non-concentrated portfolio. So far that seems okay, but at 10.5% above its
200-day moving average it’s overbought and should pull back. Since ’98
performance for the VLE has waned when it moves 10% above its 200-day moving
average (Apr. ’98, May ’99, and Sept. ’00).
“In addition, the S&P Tech sector is up more than 21% year-to-date,
has risen more than 8% in the last five days, and has posted gains 10 out of the
last 16 days for a win rate of 63%. Adding up the YTD numbers, we guess it’s a
good idea to expect a pullback now. Nothing big, but a pullback to the 2700
level for Nasdaq and 2585 for the NDX.”
Robin Griffiths, Chief Technical
Strategist, HSBC: “Relative to the world, the U.S. market is still in a
prime uptrend. Global investors should have had maximum exposure to the U.S.
during mid-1999. Since then neutral weightings have been correct. There have
been rally periods during the sideways trading range during which a more
aggressive stance paid off. As the Fed cuts rates there will be another rally.
The S&P and Dow could rally to 1550 and 12,000, respectively. The Nasdaq may
well rally to 3400 but will not make a new high, thereby, being technically the
weakest index. These moves may not end until 2002.”
Rob Cohen, Head of Listed Trading, CS
First Boston: “It’s extremely busy today. There are lots of dislocations
this morning because of some of the earnings in the optical sector. Otherwise,
everyone’s focus remains on Greenspan’s testimony in Washington and what the Fed
will do with rates when it meets next week.”