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Mix-Ansicht- Interessante Analyse zum Sentiment von Bernie Schaeffer - Tobias, 13.12.2000, 15:39
Interessante Analyse zum Sentiment von Bernie Schaeffer
Bernie Schaeffer: Too Many Bulls May Spoil The Market Broth
12/11/2000 11:08:00 AM
So I pick up my copy of this morning's Wall Street Journal and turn to the all-important C-section and notice that Abby Cohen, et al., are more bullish on the market now than they were at this time last year! That's right, folks, in December 1999 these seers were looking for a modest seven-percent gain for the market in 2000, but they now see a gain of 18 percent for 2001.
As many of you know, I was a roaring bull in late 1999 due in part to what I considered the incredible cautiousness of these same Wall Street analysts. With the Nasdaq Composite Index (COMP) at about 3600 in early December, I told the folks at Business Week that I expected us to see 5000 on the COMP by yearend 2000. In fact, I turned out to be the only one of the 50 or so Business Week prognosticators to be looking for a COMP number in 2000 with a"5-handle." And by early March 2000 we had skied to a high of 5132. Do I wish I had called the top right then? You bet. But it remains a fact that the gloom and doom of the"Wall Street boys and gals" at year-end 1999 preceded one of the greatest three-month rallies in market history.
And now our boys and gals have become roaring bulls for 2001 as they look for the big bounce off (here we go again)"the bottom." This despite the fact that we're perilously close to bear-market territory, despite the fact that earnings growth is headed south at an alarmingly rapid rate, and despite the fact that for all his recent mumblings Greenspan is nowhere close to reducing rates and will be even less close to easing if tax cutter Bush wins the election. (Memo to those who think a Bush win will be great for the market - not if Greenspan has any say in the matter.) This all should come as no surprise given that this very same group of strategists is now recommending their highest percentage allocation to stocks of the past decade. But be forewarned that the implications of extremely bullish sentiment in the context of poor market conditions are almost always ultimately bearish.
Is there room for a big short-term rally? Sure. As Jeff Cooper of www.tradingmarkets.com noted over the weekend, the market has not had a down December in 20 years thanks to heavy year-end buying by mutual funds. And such a rally could be further stoked by a Bush win and the removal by the Fed of their patently insane tightening bias on December 19. And yes, there were some beaten down stocks (Motorola, Intel, LSI Logic) that stopped going down last week after their 93rd consecutive pre-announcement of bad news, which might be a sign of some kind of short-term bottom. And I won't even quibble that just about all of those names were in the super beaten-down semiconductor sector. But note that Oracle reports this Thursday, and while a positive reaction to a"Four Horseman" earnings report could be another year-end rally catalyst, all bets are off if the number is weak or if the reaction to a decent number is negative. And finally, see my separate Market Observation this morning on the encouraging strength in the brokerage sector.
But if in fact we do rally into year-end there is the very real concern that sentiment, which is already far too complacent, would become positively giddy. Giddy just ahead of a January pre-announcement season that could make October look like a day at the beach and giddy just ahead of the first year of a presidential term that even under"normal" circumstances is the worst of the four-year election cycle for stocks. While I myself am not ruling out a switch back from a"neutral" (see my December 1 Market Observation) to a bullish posture by year-end if the technicals, the Fed, and the sentiment play out well, caveat investor is still the order of the day.
- Bernie Schaeffer
<ul> ~ Bernie's Site</ul>
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