Market Outlook, 2001

[traderx]

Many commentators are now forecasting a severe bear market with acceleration of profit warnings due to slow down in company earnings. A full blown recession is now a possibility in America. I know that everybody on this BB is aware but many analysts and market professionals are expecting worst case scenario. What does this all mean? Many of you will have seen this situation before. At the moment we have a confirmed bear market for techs with money flowing into old economy stocks. The more serious scenario is a general bear market. In this situation stocks appear exceptional value but it is very difficult to win. There are already many examples in tech stocks, look for example at GIM, BLM, BHM, SEM and BATM to name but a few. These are being given away but they are NOT cheap. Would you buy these stocks right now? I think more than ever, we need to wait and see if this is nothing more than a 'Suckers Rally'. It may turn out to be sustained but I doubt it. Some people can make money from this market but others will find themselves in a bull trap and the mark downs can be really severe, punishing your finances. I realise I am in a bearish frame of mind this year and that has limited my activity. Enough said, that's it folks. Please do come back to me on this one. I need some confirmation that I am correct in my outlook. If I am wrong please do not hesitate to challenge my views, I would genuinely welcome it.

Tx

 

[Cigar]

I can see no reason to buy tech stocks apart from short term rallys. I think a major tech rally is nearly 12 months away. The average retail punter is either scared away, or locked into companies. Whoever is forcing this decline is cutting their own throats.. the punters won't be coming back for a while. Look at the charts of techies, they've got to form bottoms, and considerable bottoms, ie months. That takes us to next summer, then perhaps a rally in the Autumn. I won't be buying any tech stocks for a long time.. I'm too scared.

As for the rest of the market, most Western economies are doing reasonably well. I think we have to look at alternative sectors. We all talk about this but never do. Look at BAT, Tesco etc. How many tech have doubled since the Spring, but theres several FT100 old giants heading that way. I've recently got into Kingfisher, probably Bass this week and maybe Sainsbury. They are the types of co's I'll be looking at for the foreseeable.

Who wants the Orange box next

rgds

 

[titus-uk]

I am relatively inexperienced in the markets - as I am sure you are sick of hearing.

However, human psychology would point out that this market has hurt a lot of people in the only place that they feel pain - their wallets. A lot who gained thousands earlier this year have lost it all - some even more. Psychology states that you become cautious, hesitant, panicky - all human emotions that go against there being a sustained rally. People aren't holding on to tech stocks now to make a profit - they simply want to minimize losses, or even break even.

There are so many resistance levels to go through on the way up - where people bought stocks at prices considering them to be "good value" - only they kept on falling. Equally, people will be glad to bail out on the way up ( esp. those who are currently locked in.)

I think there will be a short rally - when Bush wins, there will be a rebound to celebrate his corporate liberal-ness. This may well spread to techs. However, things may start to drift down again thereafter.

Me - well, as of Wed pm I will be a free man - if the royal College Surgeons are super nice to me!! Whatever happens, I will be back into checking my shortlists - although this time I will be looking at value - as Cigar said, look at Bass and other "unfashionable" stocks. But being unfashionable could make you rich.....
Cheers, Mark

------------------

 

[traderx]

As is usual, DOW through the roof today, then 1 or 2 days time dive, dive, dive, then next day or so, buy, buy, buy. What a place America is, unlike the market whimps in UK. I guess so long as you are on the right side of the US market it is possible to make money from volatility. I think the UK institutions have created this situation at home by sidelining tech stocks so nobody now wants techs at any price. On days when America powers up, UK frets and goes sideways then when America dives, UK dives more. The dynamics of UK market is very different to US. There just does not seem to be any life left in UK market. Perhaps it is structural, perhaps the great Bull market is tired and facing a prolonged period of contraction. I do not profess to know all the answers but I do know one thing, this problem will not go away like previous corrections or 6 week bear markets. We are into the down wave, big time. The natural cycle is happening despite attempts to control economies with interest rates. People simply are not spending money. I make a prediction. There is much much worse to come. Someone will get badly burned by this sick market.

Tx

 

[titus-uk]

This is working as a group.

I know that we didn't get November exactly right. However, we did call the October falls correctly. I believe that we may also be doing the same here. Trade the rallies- sure to be a mini one after US result, but things in general do not look good. I may well cut my losses soon - easrlier if the mini rally does not materialize. When it subsides, a lot of people are going to go very bearish, and things may fall rapidly.

Mark

------------------

 

[titus-uk]

This is working as a group.

I know that we didn't get November exactly right. However, we did call the October falls correctly. I believe that we may also be doing the same here. Trade the rallies- sure to be a mini one after US result, but things in general do not look good. I may well cut my losses soon - easrlier if the mini rally does not materialize. When it subsides, a lot of people are going to go very bearish, and things may fall rapidly.

Mark

------------------

 

[waldorf]

I agree with you all.
Doom and gloom it is then, no christmas pud this year.
Nothing but bad news from across the pond ,if there is going to be an end of year rally it will have to be a quickie.
I've changed my tune slightly, caution is the word. The likes of MSY- LOG-BHM-BLM- BTG ect for shorting and trading very short term, same with pharmaceuticals.
Only for the brave though. All to easy to lose a lot of money.
MM's will try to lure you in,if they can,they need the markets to keep moving. Only my opinion DYOR.


------------------

Col

[This message has been edited by waldorf (edited 05-12-2000).]

 

[titus-uk]

Mmmmmm....
Do you think the institutions are getting worried about the decline in the market - esp techs. Lehman raising their targets for BLM yesterday, stating punters "should build aggressive positions in the stock"; CSFB recommending today that people should be overweight in a couple of sectors - techs being one of them. The rampers are coming out to play, which gives some hope for us after all!!!
Mark

------------------

 

[shelman]

There will never be another great recession, the market will never again cut off the hand that feeds it, too many groups have vested interests.They will play you along, skin you for just enough without actually killing you off and then come back for more once you feel confident again.
Do not be surprised at a 'miraculous' recovery in the near future and be prepared for the subsequent investor bashing.
Steve