Internet Stock News Announces Investment Opinion: ISN Update 6/23/2000

Business Wire, June 23, 2000

Business Editors

The following is an investment opinion issued by Internet Stock

News

SAN DIEGO--(BUSINESS WIRE)--June 23, 2000

INTERNET STOCK NEWS(TM): June 23, 2000

"Internet Stock Outlook" by Ted Kunzog RIA

Also available on the Web at:

http://www.netstocks.com/article/content1.asp?edit_id=1484

While the broader market was down, technology Stocks selectively showed pockets of strength. Internet stocks, as noted by our proprietary Internet Stock Indices (located in the Market Summary section at the top right of our Web site) were down except for the largest (and most widely followed) issues. From the market close on Thursday, June 15, through June 22:

ISN Large Cap Index              2.0%
ISN Mid Cap Index               -1.0%
ISN Small Cap Index             -2.8%
ISN Micro Cap Index             -3.8%

Friday provided us with extreme volatility due to Triple Witching Day: a quarterly event that sees the simultaneous expiration of futures, options on stocks indices and options on individual stocks. For the session, the Nasdaq rose 14.86 points, or 0.39% to 3860.60, on volume of 1.4 billions shares. The gain was quite impressive considering the Dow plunged 265.52 points, or 2.48% to 10449.30. Nonetheless, market internals remained negative, with decliners outpacing advancers 21 to 17 and new lows leading new highs 73 to 59.

Monday saw Technology and Internet stocks push the Nasdaq significantly higher after the index was able to break a key resistance level. The Nasdaq jumped 129.15 points, or 3.35% to 3989.71, on volume of 1.3 billion shares. It marks the index's first close above 3900 since early May, and opens the door for prints above 4000. Nonetheless, market internals remained mixed, with advancers leading decliners by a slim margin of 10 to 9 and new lows outnumbering new highs 87 to 57.

After the close on Monday, we announced we were allocating an additional 20% of our One To Watch portfolio to two Internet stocks: InfoSpace and Inktomi. Other stocks in our portfolio include Engage, Navisite, and Verisign, bringing our total allocation of stocks within the portfolio to 50%.

On Tuesday the Nasdaq rose 23.63 points, or 0.59% to 4013.46. Even more impressive, volume climbed to 1.65 billion shares, marking a day of institutional accumulation. In addition, it was the index's first close above 4000 since mid-April; another very bullish sign. Nonetheless, market internals remained weak, as decliners beat advancers 20 to 19 and new lows outnumbered new highs 84 to 77.

Microsoft helped propel the market higher on Wednesday, due to a favorable ruling from a federal judge. For the session, the Nasdaq climbed 50.62 points, or 1.26% to 4063.98, on moderate volume of 1.5 billion shares. However, market internals were once again negative, with advancers and decliners essentially flat and new lows outnumbering new highs 87 to 57.

After five consecutive up sessions in technology and Internet stocks, investors paused for profit taking on Thursday. The Nasdaq Composite fell 127.07 points, or 3.13% to 3936.92, as selling pressure accelerated in the last hour of trading. Making matters worse, volume rose to 1.6 billion shares, marking a day of institutional distribution. Market internals were mixed, with decliners outnumbering advancers 3 to 2 and new highs leading new lows 76 to 73.

The past week has shown good gains in many issues, and investors have optimistically been thinking the recent market correction may be over. Nonetheless, we remain cautious. It is still possible interest rates will once again be raised, with rises in commodity prices threatening higher inflation on the horizon.

It is also worrisome that some sectors of the stock market are doing well, while others are not. With all the talk of "new economy" versus "old economy," we have seen this year that one sector of the market cannot do well for long without the other. In truly bullish times, all sectors of the stock market rise together, advancing issues are far greater than declining issues, and the number of daily new lows is much smaller new highs, hopefully below 25.

Nevertheless, we are optimistic, although cautious. Perhaps that is why summer times were created: to give us pause, a time to relax and a time to research our next investment.

Here is the news to help begin your research:

AT&T Wireless Group announced that it has signed definitive agreements to acquire wireless systems in the San Francisco Bay-area, San Diego and Houston markets. These acquisitions will significantly expand AT&T's national wireless network and add more than 1.3 million customers to AT&T branded and managed wireless service. Collectively, the transactions are valued at approximately $3.3 billion.

Oldeconomy.com or wave of the future? Chevron Corp. announced the formation of Silicon Valley Oil Co., an online marketplace for sales of fuels and lubricants to commercial and industrial customers via the Internet. The company noted the target users are over 8,500 petroleum marketers in a $50 billion U.S. market. Not as glamorous as selling Brittany Spears CDs, but the real growth in the Internet will occur when it is used to speed mundane applications like these.