For good measure, the Internet stocks were beaten up, as were the on-line brokers. To be sure, those vast armies of clever men and women who quit their jobs to make their fortune in trading stocks, got a real comeuppance. They love the Nifty Fifty and the Internets, and have bid them up like crazy.

Now that their favorite stocks have begun to come down, these heavily margined players will wind up in the dumpster. The tide is going out, and we see who isn't wearing a bathing suit, and it sure is not a very pretty sight.

The negative news that came out regarding some long-time favorites included:

• IBM achieved their numbers through accounting treatment.
• INTEL could be adversely affected by slowing sales growth in computers.
• PFIZER announced that second quarter profits will rise 9%, and not 20% as estimated by analysts,
• SUN MICROSYSTEMS announced that business could be hurt if purchases are delayed by customers focusing on their year 2000 problems.

Let's see how a number of these issues have been faring:

Although these sell-offs have been considerable, there is still much downside potential, in view of the generally bloated P.E.'s. And don't try to play "how low is low". No one knows when any stock will have reached the bottom of course, but it sure could be a lot lower from here. Stay tuned.

The Market Pro - April 16, 1999

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