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SAN FRANCISCO -- The bulls scored big today, but not enough to reclaim the lead.

Overcoming a rash of earnings disappointments (


(IBM) - Get International Business Machines (IBM) Report

the most prominent), a stronger-than-expected

consumer price index

, a record low for the euro, and a renewed upturn in oil prices, major market proxies dramatically pared early morning losses.

Once as low as 9654.64 (a new intraday 52-week low), the

Dow Jones Industrial Average

clambered back to finish off just 1.1% to 9975.02. The

S&P 500

finished off 0.6% to 1342.13 after trading as low as 1305.79. The

Nasdaq Composite

, meanwhile, shed just 1.3% to 3171.56 after trading as low as 3026.11, or below levels reached even during the harrowing days of spring.

Stellar results from

Sun Microsystems

TheStreet Recommends

(SUNW) - Get Sunworks, Inc. Report

were cited as a catalyst for the turnaround. Strong gains by


(INTC) - Get Intel Corporation (INTC) Report



(MSFT) - Get Microsoft Corporation (MSFT) Report

, which reported better-than-expected earnings after the close, also buoyed investors' spirits and the Comp. Finally, the nice-round-numbers of

Dow 10,000 and Nasdaq 3000 compelled buyers who apparently felt the selling had simply gone beyond rationality.

Predictably, the session spurred talk that the much-ballyhooed bottom is at hand. Just as predictably, I am dubious.

First, the Dow closed below 10,000 for the first time since March 14, which is going to shake the tail feathers of those strange creatures who don't follow the markets all day long every day;


people, that is. Second, the Comp held 3000 but still visited levels unseen since November 1999; levels it might revisit in the coming weeks. Third, for all the hubbub about Sun, it closed up 1% at $110.31 after trading as high as $119.50.

But I'm skeptical mainly because of the macroeconomic factors mentioned above: None of them are going away and none of them are particularly constructive for equities.

Most notably, the CPI's 0.5% rise was its largest since June. Sure, that was largely due to higher energy prices, but core CPI -- which excludes food and energy -- also rose 0.3%, its biggest increase since April. That just doesn't jibe with the talk on Wall Street that the

Federal Reserve

might soon adopt a neutral bias and/or consider easing interest rates anytime soon.

Several folks in the "Fed-ease-soon" camp proffered the following rationale: That the September figures are lagging and were unduly influenced by oil's spike. In reply, I note the CPI is growing at an annual rate of 3.5% and the core rate is rising at an annual rate of 2.6%, its fastest pace since April 1997. Again, core CPI


oil, which closed up 1.2% to $33.40 a barrel in

New York Mercantile Exchange

trading after a report showed U.S. inventories at a 24-year low.

It seems we have a situation where economic growth (and corporate profits) are slowing, but inflation is on the rise, providing a major obstacle for the Fed to ease. If unemployment wasn't so low, you could make an argument we're about to see stagflation, revisited.

Then again,


(F) - Get Ford Motor Company Report



(IR) - Get Ingersoll-Rand Plc (IR) Report

each announced layoffs today.

Equal Opportunity Prognostications

Even I am struck by my recent negativity. I don't think the world is about to end (I swear!), and am not blind to the positive demographic forces that aid the market.

But I do think investors should use any rallies that may emerge not as a signal to rush back into the market, but to re-evaluate their holdings -- especially if they include stratospheric-fliers (


just ain't high enough) such as


(JNPR) - Get Juniper Networks, Inc. (JNPR) Report

, trading at 369 times projected 2001 earnings after dipping 5.3% today.

Every other once "bulletproof" group of stocks has gotten a comeuppance this year; why should the current batch of favorites be any different?

Wait, my intent here was to air some thoughts of those who are thinking we have bottomed, or are about to


That was the word from Brian Belski, fundamental market strategist at

U.S. Bancorp Piper Jaffray

, during a meeting this morning in Menlow Park, Calif.

After trying to scare the crowd of venture capitalists and buy-siders with tales of bearishness, Belski declared the "signs of a bottom" are at hand -- much as he did

one week ago. The strategist

reiterated his year-end targets of 11,800-12,000 for the Dow, 1575-1600 for the S&P 500, and 4200-4400 for the Comp.

Belski's overall message was "we still need to own tech," noting that industry's growth and earnings rates continue to outpace the market average while price-to-earning ratios for more than 50 (mostly household) tech names are currently trading at their lowest levels in both the last 12 months and 5 years.

Tony Dwyer, chief market strategist at

Kirlin Holdings

, expressed a similar message in a report out this morning, in which he noted that, as of Oct. 12, the Nasdaq was trading 15.8% below its then 200-day moving average of 3649.

In the previous 10 instances when the Comp has traded 15% or more below its 200-day moving average since 1990, the index had average returns of 24%, 35% and 52% in the three-month, six-month and 12-month periods which followed, Dwyer reported.

"There is some further risk," he wrote," but the historical numbers show the reward far outweighs the risk at current levels."

If that sounds at all familiar (it did to me), recall that back on

May 31, Dwyer noted advancing volume bested declining volume by more than 5-to-1 that day. In the seven occurrences prior to that session, the Comp's average return for the one-month, three-month and six-month periods following was 7.2%, 25.1%, and 47.1%, respectively.

The Comp rose 16.6% the first month after May 31; for three months, the return was 23.7%. The six-month return remains to be seen, but the index is now down 6.75% since May 31, meaning the next six weeks are going to have to be blockbuster for the Comp to approach its past performance trends.

Brinker Tailor Soldier Spy

Last night I reported Bob Brinker, editor and publisher of

Bob Brinker's Marketimer

and host of

ABC Radio's


, reportedly made a recommendation to his newsletter subscribers to buy the

Nasdaq 100 Trust

(QQQ) - Get Invesco QQQ Trust Report


I have obtained a copy of the bulletin, which confirms that report. Brinker did recommend buying the QQQs, predicted gains in excess of 20% "from the vicinity of the recently established closing low," and suggested subscribers use up to 50% of cash reserves to make the trade. Brinker used the term "countertrend rally" to describe the trade, suggesting he has not abandoned the negative market stance adopted in January.

Brinker declined to comment.

Aaron L. Task writes daily for In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in He also doesn't invest in hedge funds or other private investment partnerships. He invites you to send your feedback to

Aaron L. Task.