Tech wants to go higher. It takes non-earnings news like the
deal last week and the
deal this week to show me that. Neither of these has anything to do with raising numbers, but they do show that people feel the tech correction may be running its course. You only get this kind of buying -- despite the numbers -- when people have to have a sector.
The tough thing about Intel is that its rally is occurring right on the heels of
saying the company's Pentium III launch is just going so-so. (How the firm knows this eludes me, but it did squawk the discovery.) That's too hard for me; I need to have more than a "feel" to buy. I need earnings. That said, I am encouraged by all of the selling in the
Morgan Stanley High Tech
index, or MSH, puts, as well as the covering of MSH calls that were sold short in anticipation of tech coming down.
For me, that means picking selectively at tech people feel good about -- which, as I keep saying, means telco tech or networking tech -- while avoiding drive and PC tech.
And, of course, the Net. Which seems to be weathering the maelstrom with great aplomb.
In the meantime, I am using weakness in the financials to rebuild banks and brokers, as I let some of them go on Friday's strength.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column by sending a letter to TheStreet.com.