Laggards Become Leaders
Being a growth-stock
investor, I am
becoming very jealous. Not because growth stocks are in a brutal bear market,
not because of their sorry technical condition and not because of their wide and loose swings.
I am jealous because I am finding a ton of breakouts in some “less-than-exciting”
sectors. I long for some glamour names to look like the 50 or
so energy stocks that broke out in the last few days.
Energy now joins utilities, insurance,
S&Ls and a few medical as the leading sectors. Am I exciting you yet?
A few positives to ponder:
- The “new high list” has expanded greatly over the last
week. It is mostly
the “Revenge of the Nerds” stocks I have been talking about. - The NYSE advance/decline line is starting to lead.
- Interest rates have plummeted and the Fed is most definitely going to play
catch-up. - Most economic numbers are headed
south. (Believe it or not, this is good for the market.) - Retail and apparel are starting to rally in the face of poor
Christmas numbers. The market is looking forward at the potential for better times ahead.
All this means is that the parts of the market that were laid to waste prior to 2000 are now
leading. I continue to believe this isn’t going to change any time soon. I am hoping for better days for the glamours but, as I have always
said, hope and prayer do not go hand-in-hand with Wall Street. Most past leaders still have horrible technicals. Some of them are now wedging up on light
volume. This has only led to failure recently. Maybe growth stocks will play catch-up one day? I just think they have a lot more work to do.Â
The really good news is that 2000 is almost
over. I wish everyone a happy, healthy and prosperous new year.