Forum Archive Index - April 2000

["Ben Dutton" <bendutton@sharechat.co.nz>]

I agree with Nick and have to say that I've been absolutely amazed about how the NZ media has been beating up Friday's performance on Wall Street - "Black Friday"; NZ to experience a "Black Monday"; "Biggest one day point drop on the Dow ever" (this is irrelevant - it's the percentage drop that's important) etc etc. 

 

The Dow is still above 10,000 - remember when it first breached that mark last year?  People couldn't believe that it was possible.

 

The Nasdaq has been hit hard, but everyone knew it was approaching heights that were unsustainable - sooner or later it had to be deflated.  Some of the excuses for Internet companies had to be crushed - and now that it's happened, investors can once focus again on quality (Microsoft, Cisco, Sun etc).

 

Everyone should keep a cool head on Monday morning - I'm very optimistic that we will not see a rush of panic selling a la 1987. 

 

The NZ market never even began to experience the gains of the markets over in the U.S. 

 

How can a bubble burst if it's never been formed?

 

Happy investing (I for one will be looking closely at Wall Street on Monday.  If it recovers, come Tuesday morning I'll be filling up my shopping basket like a very happy camper).

 

Benjamin Dutton

 

 

 

----- Original Message -----

From: nick

To: sharechat@sharechat.co.nz

Sent: Sunday, April 16, 2000 4:44 PM

Subject: Re: Re: [sharechat] strange illogic in the US action, will they think again?

   Im still not convinced it was panic, more an orderly retreat.

Lets face it we all know how overvalued the tech stocks have become.

  There was a slight recovery from the lows at the end of the day so there

were a few brave (silly) buyers around, and the market wasnt in complete freefall.

        The volatility the last week or two has been becoming more and more

extreme.   The market is 25% down from its highs but has taken a week to

fall so far. Anyone wanting to exit has had plenty of opportunity.

       What was worrying about friday was the extent which the dow joined in,

although this was i suspect more to do with the inflation figure and would of happened

with or without the nasdaq.

           The fact it happened on a friday is good as it gives nervous investors

a chance to calm down. The retreat in the nasdaq will probably continue for a while

although i expect the retreat to slow and be more selective. ie bad stocks will be

hammered but the good ones will stabalise.

       In new zealand i suspect that by friday we will all be wondering what the fuss

was about.

          nick