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Jim Cramer
Editor's note: This article is the final installment of a 3-part series. Please be sure to check out Part 1 and Part 2, which were published earlier this morning!
Continuation of the "What Went Wrong?" checklist: 7. Merger and acquisition activity peaked with the dinging of the Sprint (PCS Quote) deal. This collapse, coupled with the earnings disappointment for WorldCom(WCOM Quote), meant an end to the mass consolidation in the sector. Smaller players can still get bids, but the larger players won't get gobbled so fast. I think this will get better in the fall if Bush wins, because I can imagine that guy dismantling antitrust. 8. Short-term rate-rise expectations crushed the financials. This group had been humming, with many of its players hitting 52-week highs. Wachovia's (WB Quote) nasty blowup took care of the 52-week high fever, and possible rate increases kiboshed anything else that could happen positively. I think the negatives here are well-discounted, but I am not running out to buy the group. 9. Pfizer(PFE Quote), which had become the leader of a resurgent drug group, blew the quarter. This was a terrible blow to drug investors who had begun to think that Pfizer had regained the luster it had a couple of years ago. Merger savings don't seem to stanch the bleeding here. Lilly (LLY Quote) can't do what Pfizer could. 10. Philip Morris (MO Quote) lost the big case that had been holding it back. A win in this class-action case in Florida would have kept the food group, another leader, cooking well into the fall. Instead, the biggest-cap in the business lost its footing. I think this stock comes back, but it doesn't have any momentum. There's your checklist. Lots of stuff went wrong. Some of it can be undone, most can't. Which is why we aren't going anywhere anytime soon. We will bounce around with 3% gains and 4% drops, mixed with 4% gains and 3% drops as we get closer to NDX 3300. Boring, range-bound, frustrating. Get used to it. It will be like that for some time.
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