The Greek Debt Crisis “Staycation” is in Full Swing
Unlike most summers when just about every investment banker on Wall Street goes on vacation for the month of July, it appears this year most of them stayed home as the Greek debt crisis slowly unfolded. Combined with China’s collapsing stock market (down 30% in less than a month!), the threat these two risks posed to their year-end bonuses was just too great to ignore.
But since neither one of those events has had much of an impact on the U.S. stock market thus far, their attention seems to have shifted to tech stocks. The big news this week is IBM’s quarterly earnings report, which sent its share price spiraling down more than 6% in trading Tuesday morning. Somewhat surprisingly, the tech-heave NASDAQ Composite Index barely fell at all, and the S&P 500 was off only slightly.
That price action suggests that by now just about everyone recognizes IBM’s irrelevance to the future direction of the tech market. As Dr. Duarte points out in our In Focus article, so far this year the NASDAQ Biotech Index (NBI) has gained 33% while the S&P 500 is up about 3%. It looks like a lot of fund managers believe the opportunity for gain with tech stocks lies in the smaller companies whose names you hardly ever hear until its too late.
In our Sector Spotlight article, Rob DeFrancesco takes a close look at Infoblox to determine if it is time to buy into this one-time high-flyer whose stock has recently fallen on hard times. Although you seldom hear the term “value trap” applied to small-cap tech stocks, it appears in this case that you may need to be careful in deciding when to get back into this name.
And in his Next Wave Portfolio Update, Rob has decided to cash in his big gain in Gigamon – up nearly 50% since he first recommended it only four months ago – and plow the proceeds back into Qualys. Although we are not a short-term trading service, sometimes the share price of one of our company’s gets bid up so fast that we feel we simply cannot justify holding it any longer.
All of which means we aren’t taking the summer off, either.
But since neither one of those events has had much of an impact on the U.S. stock market thus far, their attention seems to have shifted to tech stocks. The big news this week is IBM’s quarterly earnings report, which sent its share price spiraling down more than 6% in trading Tuesday morning. Somewhat surprisingly, the tech-heave NASDAQ Composite Index barely fell at all, and the S&P 500 was off only slightly.
That price action suggests that by now just about everyone recognizes IBM’s irrelevance to the future direction of the tech market. As Dr. Duarte points out in our In Focus article, so far this year the NASDAQ Biotech Index (NBI) has gained 33% while the S&P 500 is up about 3%. It looks like a lot of fund managers believe the opportunity for gain with tech stocks lies in the smaller companies whose names you hardly ever hear until its too late.
In our Sector Spotlight article, Rob DeFrancesco takes a close look at Infoblox to determine if it is time to buy into this one-time high-flyer whose stock has recently fallen on hard times. Although you seldom hear the term “value trap” applied to small-cap tech stocks, it appears in this case that you may need to be careful in deciding when to get back into this name.
And in his Next Wave Portfolio Update, Rob has decided to cash in his big gain in Gigamon – up nearly 50% since he first recommended it only four months ago – and plow the proceeds back into Qualys. Although we are not a short-term trading service, sometimes the share price of one of our company’s gets bid up so fast that we feel we simply cannot justify holding it any longer.
All of which means we aren’t taking the summer off, either.
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