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For the last two weeks, the money on Wall Street has been flowing out of the ever popular technology-based NASDAQ stocks into the cyclical NYSE stocks. With the exemption of IBM, computer stocks have taken the big dive.
So you say your Microsoft holdings are down a few points; be glad you weren't holding America Online or Amazon.com, as they lost dozens. If you own Alcoa or Caterpillar, you are jammin'. Evidently, the improving Asian economy has led the stock buyers to the short term profits of the construction and materials sector, and facilitated the abandonment of the NASDAQ technology and internet stocks. Is it really all the world situation in Asia, that has turned the high-tech sector into a eunuch? Don't they buy and sell computers and communication equipment there too?
Maybe the situation in Washington ( or Kosovo ) has a little something to do about it also? Raytheon stock has been steadily going up since the beginning of hostilities, especially since the media started making a big deal about running low ( out of ) ALCMs ( air launched cruise missiles ). Yes, Raytheon builds the ALCMs; Hughes makes the U.S. Navy ship launched cruise missiles, we have plenty of those still in stock. In the six weeks NATO ( America ) has been going at it in Yugoslavia, Raytheon ( both A and B ) have gone from fifty something a share to seventy something a share; just the opposite for a large portion of the civilian sector high-tech and internet stocks.
For the first few weeks, the stock market seemed not to notice the undeclared war. We all know what usually happens during a war; the market goes down. Well, not this time, exactly. The DJIA average hit an alltime high on Monday, going up and closing over eleven thousand for the first time ever, partially powered by IBM, plus those cyclical stocks that never showed themselves last year. Are those construction stocks responding to the situation of rebuilding the NATO bombed out territories in the Balkans?
Well, with NATO's war not going precisely the way they planned it, like in Yugoslavia's failure to knuckle under and NATO's targetting of purely civilian locations ( and the resulting loss of women and children to the NATO bombs ), the President has seemingly lowered his victory conditions for NATO to accept or declare it has won the non-war.
With world opinion shakey at best, and Clinton deserting the Washington ship for NATO's greener pastures, the stock market is left to it's unpredictable, volatile self. Only time will tell, if the technology stocks with bounce back soon, but one thing is for certain. There are some cheap high technology and internet stock buys out there for the patient people among us. Day-traders are not patient, see: Casting The Net Over Wall Street? ( 4-10-99 ) .
Hold you emotions in check, have some patience. The dough is in the oven and it will be bread soon.
- Bongo ( Trade this! )
