Overheard On The Street
Here’s what they’re saying at mid-day:
Frank Gretz, Market Analyst, Shields
& Co.: “With regards to Intel’s news last week, in reality, it will
impact all of tech. First, there is the psychological impact, even if it’s an
Intel-specific problem, that selling in one tech begets selling in the rest.
Secondly, it’s not altogether clear that this is an Intel-specific problem. At
first glance, the problem seems to relate to a “slowdown” in Europe,
the point being a slowdown for Intel isn’t likely just a slowdown for Intel.
Maybe we now know why the SOX
(
SOX |
Quote |
Chart |
News |
PowerRating)has gone nowhere for months.”
Paul Rabbitt, President,
RabbittAnalytics.com: “What are the lower earnings scapegoats? Take your
choice. They are either the strong dollar or raging oil prices. The worst news
may have already been absorbed. Equity prices have adjusted to reality, and the
efforts by the U.S. to help ease oil prices and dollar/euro strength in the
short run might help boost sentiment for equities. Yes, the strong dollar hurts
growth a little, and the impact will be 2% to 3% lower earnings-per-share in the
third quarter. High oil prices are expected to harm individual groups in the
U.S. but have a less dramatic effect on the U.S. corporations who hedge, and
this is because hedging helps cushion the earnings-per-share impact of currency
and energy gyrations.”
John Roque, Vice President, Arnhold and
S. Bleichroeder: “Most of the investing public, meaning pension/mutual fund
investors and retail investors, are finally, albeit reluctantly, coming to grip
with the fact that tech in general, and semis in particular, are the latest
incarnation of Achilles. Now this is what it sounds like when doves cry. This is
a good sign from a sentiment point of view because it says that expectations are
being reduced. However, it’s not a great sentiment sign because if it were a
great sentiment sign, investors would hate technology right now, and they don’t.
But with reduced expectations there will likely be fewer arrows to the
head.”
Â
Do you have a follow-up question about something in this column or other questions about trading stocks, futures, options or funds? Let our expert contributors provide answers in the TradingMarkets Question & Answer section! E-mail your question to questions@tradingmarkets.com.
For the latest answers to subscriber questions, check out the Q&A section, linked at the bottom-right section of the TradingMarkets.com home page.