Friday, March 21, 2003
Copyright © Las Vegas Review-Journal

Investors wonder: Where to now?

Advisers say locals have little interest in stocks

Day trader Danny Regensberg and his colleagues at Bright Trading track stocks Thursday, unsure where the market will head next. Photo by John Gurzinski.

After weeks of market uncertainty, local investors and traders faced new questions on the first full day of war about where the market is heading.

Mike Henderson, 61, an investor and financial analyst with the Public Utilities Commission, may be typical. He said goodbye to some of his last stock holdings Thursday and has no plans to get back in the market.

"Who knows whether (the war) is going to be good for (the market) or bad for it," Henderson said.

Art Chevalier, branch manager of Quick & Reilly, also is uncertain about what to do.

"I believe the news is going to drive the market now. I tend to believe (it doesn't) most of the time," he said.

Chevalier said anticipated economic developments are the keys to stock market direction usually but added that it's difficult to know what will happen in war.

In fact, professionals at Bright Trading were listening to television news about the war as they stared impassively at stock market monitors Thursday trying to gauge the market's direction.

"A lot of smaller (investors) were on the sidelines, and the bigger guys were taking control," said Don Bright, a trader and director of education at Bright Trading.

As it turned out, the Dow Jones industrial average was almost unchanged, gaining 21 points, or one-quarter of a percent, Thursday.

Bob Bright, chief executive officer of Bright Trading, pointed to an intraday low of 7,397 for the Dow on March 12, almost 900 lower than the 8,826 close on Thursday.

For now, however, Joe McGinley, vice president and branch manager for Charles Schwab in Las Vegas, said individual investors generally show little interest in buying or selling stocks.

"Over the last few weeks certainly it's been quiet," he said. "People are, just for the most part, sitting on the sidelines."

Schwab clients do seem to be positive about the outlook after hostilities cease, McGinley, said.

Meanwhile, John Futrell of Futrell Financial Management said: "There's no real excitement."

His firm made a strategic move to focus on more conservative products about a year ago. The firm offers fixed-rate annuities and bonds.

"We're going to start moving out of bonds, because of our current economic environment," Futrell said.

The firm will change its focus back to the stock market when it shows signs of improvement, he said.

Hugh Anderson, vice president with Merrill Lynch in Las Vegas, said: "We have not had any clients call us up changing course or anything. We try to orient investors to long-term financial planning so that we can ignore, as best we can, the day-to-day diversions."

For Henderson, the long-term focus is now bonds. He said he retains a few stock holdings, but he kept them because their price is too low to matter much.

He is glad he sold most of his stocks in summer 2000 and switched to bond funds in the early stages of the current bear market for stocks. The timing was wonderful, because stocks continued to fall over the last three years and bonds have soared.

"It wasn't because I was smart," he said. Henderson said he thought he was retiring and wanted income.