Overheard On The Street

  • January 22, 2001
  • Daniel Beighley

Here’s what they’re saying at mid-day:

John Hughes,
Senior Technical Analyst, Shields & Co.: “The past two to three weeks continue
to show technical improvements in the market. The ‘average stock,’ as measured
by the advance/decline index, has been improving in both the NYSE and NASDAQ.
The number of NYSE exchange stocks making lower lows is contracting, and we have
had total volume traded increase on up days and a decrease in down days. All
these signs may indicate the market may be beginning to bottom, or at least stop
going down. The one missing factor is market leadership, which typically leads a
new bull market. The intermediate/long-term trend remains down.”

Paul Rabbitt,
President, Rabbitt Analytics.com: “The
Fed Watch should continue to dominate investor attention. Thursday
will be the day to watch economic events. 
In the morning, the closely watched Q4 Employment Cost Index will be
reported.  Rising
wage costs could derail the expected Fed rate cut at the meeting January 30-31. 
Also December Durable Goods orders are reported. 
They are expected to be weak. 
Finally, Fed Chairman Alan Greenspan testifies before the Senate Budget
Committee.  Watch
his testimony for hints about rate changes at the FOMC meeting next week.”

Brian Belski, Fundamental Market
Strategist, U.S. Bancorp/Piper Jaffray: “Just as we expected, the stock
market’s recent recovery and overall solidification has taken on a decidedly
mega-cap technology/telecom theme and feel, as the premier names we loved in
1997-99 and hated last year have taken over on the upside again. Why has this
phenomenon occurred again, especially considering the disdain for technology and
telecom fundamentals heading into this year, let alone the up to the minute
projections of slowing growth that we keep hearing? While the bulls and bears
have differing opinions, we believe both sides are buying for the same reason,
and that reason is defense. Defensive technology buying = buying the
traditional leaders = consistent earnings = largest cap stocks = liquidity
insurance.”