John J. Edwards III chatted on AOL MarketTalk on March 15. AOL's MarketTalk is hosted by Sage Online (Keyword: Live).

Sage MikeM:

Welcome, John! Firstly, what is your view of the market's actions over the past week and where do you think we are going from here?

J Edwards:

The market has certainly seemed to have a very positive bench to it over the last week or so, really the last 2 weeks. It looks like investors are satisfied that the interest rate picture is under control, that is that the long bond isn't likely to hit 6% anytime soon. Coupling that with signs of strength in the economy without signs of inflation, is making investors more confident in the corporate profit picture going forward. So with this as the back drop, it looks like we can see some further appreciation here despite the already high valuations in the market.

Question:

Future of egrp?

J Edwards:

While I can't really give an outlook on individual stocks, I can suggest that you check out our very good online brokerage coverage on

TheStreet.com

.

Question:

How does the oil sector look to you?

J Edwards:

In the oil sector, it looks like if

Opec

and the other major oil producing nations are able to finally put in place the production controls they've been talking about, we might finally see an end to the downward spiral of oil prices and some recovery there. I would say that looking at the progress of those production control discussions would be that investors best bet in deciding whether to invest in the oil area.

Question:

Do you foresee widespread earnings among e-commerce companies within the next couple of years?

J Edwards:

It's hard to say. It very well might be at least a couple of years before we see widespread profitability in the e-commerce area simply because these companies are involved in a very aggressive marketing and branding effort that is eating up a lot of their revenue. In addition, the already small profit margins in retail are often even smaller in e-commerce because of the need to compete even more aggressively on price.

Question:

How do the pharmaceuticals look, long and short term?

J Edwards:

The pharmaceutical companies, as a group, are always pretty solid in times of economic uncertainty as people look for defensive issues that are likely to hold up well despite an economic downturn. It's important to look at the individual companies in the industry to see what their drug pipelines look like. A lot of pharmaceutical companies are going to be encountering problems with patent expirations the next few years and that will be a significant challenge for those companies in coming up with new blockbuster drugs to fill the gap.

Question:

Which sectors look strongest over the next 12 months?

J Edwards:

I would say there continues to be a great deal of opportunity in the technology area and selected internet stocks are likely to continue to see appreciation as this really young industry grows and matures.

Question:

Do you believe retail companies will continue to have a good year?

J Edwards:

The continuing strength of the economy does suggest that retail continues to be a pretty solid area, given that employment still remains high, there's wage appreciation. These and other factors suggest that the consumer remains ready to buy and retail companies should benefit from that.

Question:

How fast do you believe online brokerage will grow in the coming year or two. Would a downturn in the market harm them significantly?

J Edwards:

Growth in online brokerages should remain swift, given he combination of both increased interest among consumers and handling their own finances and the increased usership of the internet, which continues to grow at an extremely rapid pace. A market downturn might not have as severe an impact on the online brokerages as one might think. In a downturn situation, people are likely to try to, in many instances, trade their way out of it and there would probably be active trading among the online brokers. In a sustained downturn might very well hurt online brokerages just as it will hurt more traditional brokerages and other financial concerns.

Question:

What advice would you give to beginning investors, in terms of the type of research they should do before investing?

J Edwards:

I would advise basically reading as much both institutional research and good financial journalism as possible before dipping into the investment environment. If the investor is working with a traditional broker, it's important to ask as many questions as necessary until you feel comfortable with the investment decisions you're making. If you're striking out on your own, it's important to gather research from both online brokerages that provide free research in many instances, and from publications such as

TheStreet.com

,

The Wall Street Journal

, and others that cover the world of finance thoroughly and accurately.

Question:

Are you bullish still on the market at this level. Where does it stop?

J Edwards:

As a journalist and not a financial advisor, I don't really consider myself either bullish or bearish and it's certainly difficult for me to make a prediction as to where things might stop. I can say that it does seem that there are considerable fundamental underpinnings to the success the stock market has had to this point, including gains in productivity, and the continued lack of serious inflation pressures. I think we would need to see some significant change in the economic backdrop before a severe market break would be likely.

Sage MikeM:

Thank you, John Edwards, markets editor of

TheStreet.com

-- it's always a pleasure!