2001 MARKET FORECASTS
It is NOT WHAT you know, but WHEN you know it.
© Henry Weingarten Last Updated:
Some of the following material has been serialized in our newsletter
STREET, NEXT WEEK and our premium
channels. It was posted first to WSNW subscribers on 11/14 and
will be updated publicly at our 9th Annual Astrology and Stock Market Seminar,
May 17-20, 2001, in New York City.
Note: Hyper links that are prefaced with a S:, G: or P: are restricted
to WSNW Subscribers.
There are 3 new primary phenomena affecting world events and global
markets in 2001:
January 20 inauguration of a new US
The Solar Eclipse on the Summer Solstice
June 21, 2001.
New Stock Exchange (new Bourse horoscopes)
to be born such as Euronext, Jiway, International Nasdaq and LSE alliance
Continuation of three BIG TRENDS begun in 2000:
1. MORE REALISTIC STOCK VALUATION (Jupiter/Saturn)
Short term out performance of value stocks/funds vs growth stock/funds.
Intermediate term best performance will be value stocks (Saturn) that also
are growing (Jupiter).
Lower P/E valuations, but higher than historic norms which are slightly
above DJIA 6000 and 2000 for Nasdaq. This picture started changing
due to the Jupiter/Saturn conjunction in May 2000. Earnings and real business
prospects now matter. Hence stock forecasting will become easier and somewhat
2. DOLLAR DECLINE ACCELERATING IN 2001
The secular US$ rally is over, having ended with two peaks, one in
May 2000 and one 6 months later. If you liked $10 Oil, then you will
the Euro .87-90!
3. JUPITER/PLUTO and SATURN/PLUTO
These aspects plus new FASB rules forecast more failed mergers and
corporate break ups. Politically more anti-globalization protests.
The first half of 2001 will continue the trend to lower corporate profits,
eventually resulting in lower expectations or price/earning multiples.
Short term, we expect interest rate increases. In 2001, it may become necessary
to defend the US dollar and that will NOT be cause for a major stock market
rally. Intermediate term, we forecast interest rate decreases. Hence,
Bonds and Bond funds will command increasing attention of global investors.
Fundamentally, for the stock market in 2001 to reach their 2000 highs
is unlikely for Nasdaq. DJIA may close slightly positive on the year, especially
if there is talk of future permission of some social security and/or greater
tax sheltered funds into the market.
Capital Preservation will continue to be
important for global investors for most of 2001. 2001
investing demands extensive portfolio evaluation, diversification and more
frequent trading in order to obtain very positive results. Global
money flows will no longer exclusively favor the US. Eventually,
however, the markets should have a year end rally above 10,000 and Nasdaq
HOW HIGH IS UP?
HOW LOW IS LOW?
2001 TRADING RANGES
DJIA: 8,800 to 11,660
NASDAQ: 2200 to 3880
VALUE WITH GROWTH
Just as stocks with 200 P/E are taboo now,
so too will the 100 P/E stocks be next year.
We don't expect a single "parallel" market crash,
but continued sequential ones - with more overpriced stocks dropping 20-30%
in a day on "bad" news.
Our advice: Buy good stocks AFTER bad news, NOT
INVESTORS SHOULD BUY AND HOLD STOCKS IN
2001 THAT ARE:
2) P/E under 33 for TMT (Technology, Media, Telecommunications);
22 for others,
3) Less than 25% over Morningstar
I GLOBAL INVESTING
BUY CANADA & NORTHERN EUROPE
TRADE THE UNITED STATES
GLOBAL 2001 MODEL PORTFOLIO WEIGHTING:
EUROPE: 35% North America 45% ASIA: 20%
The Horoscope is a MAP of TIME and PLACE - here is a brief overview
of selected global markets:
EUROPE - Relative strength
in North Euroland & Euro strengthening by 2002
GERMANY - Blue Chips [EWG] outperform as German behemoths domestically
split up and merge/acquire globally. [Pluto/Uranus in 2001 followed by
Jupiter in 2002.]
HOLLAND - Continues to be one of three favorite countries in 2001.
Strongest positive influences and the Euro rallies will make this the star
performer we have long been talking about. By 3rd quarter of 2001, we may
begin selling into strength.
ENGLAND - We find better value elsewhere. Our rule of thumb is that
we must find at least a 10% premium to domestic stocks, e.g. Pearson (PRSNY)
while a good media company is no better than the NY Times (NYT).
However, our view of the city changes for the better in 2002 and
perhaps sooner depending on the new iX horoscope.
AUSTRIA [EWO], due to economically sound government policies, will outperform.
NORTH AMERICA - Traders paradise
ASIA/PACIFIC - Long term investment opportunities
- Invest here for increasing prosperity in 2001-2002! The Canadian Dollar
is a great bargain and will outperform US Dollar by 2002.
MEXICO - While certain international stocks, e.g. CX, will perform
well and it continues to benefit from NAFTA, we prefer to wait and see
how its new president performs.
UNITED STATES - Generally overvalued versus global counterparts. Top stocks
having value will perform, many others will disappoint. US Bonds attractive
mid 2001 and stronger in the Fall. (Foreign investors may wish to hedge
the US currency.) The US Dollar remains a ticking time bomb before
January 2002: It is no longer as safe a haven with new competition
forthcoming from the EURO in 2001 and perhaps even gold. However,
since one can trade stocks here for 10-25% appreciation/depreciation a
day/week, this remains TRADER'S HEAVEN.
We are beginning to like Japan and will start buying [EWJ] on dips, especially
if/when the Yen is weaker than 111-115. We prefer exporters e.g. Sony (SNE),
Matsushita (MC). Ideally we are hoping to see the Nikkei 225 at 12,222.
If so, we will buy with both hands, as JAPAN INC may be one of our favorite
HONG KONG/CHINA - Political problems/potential violence in 2001!
Add to this the fact that most of the mainland's industries are a mess
and China's horoscopes are "challenged". Therefore, we continue to recommend
AVOID. Despite a good economy, we would reduce any exposure
to Taiwanese markets unless fully compensated for the extra risk.
KOREA- Buy select, non-bankrupt :), companies such as Samsung Electronics
(SSNGF). A MAJOR peace dividend is expected in 2001/2002.
INDIA- The most money
to be made by insiders. Buy bargains if/ when you find them.
OTHER- Opportunities for savvy investors ONLY.
AUSTRALIA - We are neutral until 2002, however, eventually the Aussie dollar
ISRAEL - Israel's technology sector will continue to outperform given its
highly skilled labor force and favorable tax treatment. However,
like the US, it remains overvalued and bargains are hard to come by. Unfortunately
it is best to buy only when there is blood in the streets.
RUSSIA - If/when there is a rule of law, many attractive high risk/high
reward opportunities will present themselves.
As long as it remains an open question whether a "soft" landing
can be engineered or whether a "hard" crash is inevitable sooner or later,
we continue to recommend avoiding emerging markets. In 2002, the
global investing landscape may be dramatically different.
Traders believe that "Making money in the market is all about Timing".
The "Buy And Hold" climate we've had in the US stock market is PAST HISTORY.
It has slowly but surely given way to a "Market Timing" and “Stock Picking”
environment. Since May 2000, the new planetary theme became Jupiter/Saturn.
This once every 20 year pairing of the two major planets best rewards Value
Despite the fact that we do live in interesting times, we continue to
repeat our mantra:
BORING IS GOOD and VALUE plus GROWTH IS BEST.
Old-line technology companies such as IBM, Rockwell
(ROK), Texas Instruments (TI) and United Technologies (TUX) will be relative
safe heavens in 2001 and generally outperform.
Traditional safe heavens such as Real Estate and Utilities are tradable,
but may give occasional sleepless nights.
Cosmic markers that began in 2000 that will finish in 2002:
The final pass of Jupiter opposite Pluto is May 6, 2001 for new M/A accounting
rules and zeitgeist. This is midway between the Jupiter/Pluto conjunction
of December 94 when "whales first started swallowing whales" and December
2007 when retiring baby boomers are forecast to exit markets en mass.
Sectors such as Biotechnology, Robotics and Successor Energy will
continue to march forward to center stage.
The first two passes of Saturn opposite Pluto are August 5 and November
2 in 2001 and May 26, 2002. In addition to increasing opposition
to merger mania and globalization of the World Bank and IMF, how many pieces
can ATT, BT, etc., split themselves into?
An early [December] and late [February] "January effect" in the Technology
sector even more than small caps. Nasdaq is likely to both outperform
AND underperform the DJIA depending on which months you are looking, i.e.
more Traders Heaven.
We recommend high cash positions for the 2nd quarter of 2001. Post tax
time April will be punishing indeed for aggressive portfolios. We expect
that tax revenues for both individuals and corporations will disappoint
budget surplus calculators. Consider yourself warned and act appropriately.
We will discuss the post summer solstice Solar eclipse markets in our
May 2001 update.
No one can postpone the date of the next total eclipse of the Sun, which
will take place on June
21, 2001, in turn followed by Saturn opposite Pluto on August 5, November
2 and May 26, 2002 (Key Pivot month).
As we move to 2003, Saturn goes over the US Sun and the low point of
the nodal cycle is reached in 2008. December 2007 we have Jupiter
conjunct Pluto, followed by Jupiter conjunct Neptune in 2009 and Jupiter
conjunct Uranus in 2010.
My new three favorite post millennium themes are: Hydrogen/Solar, Robotics,
The old themes of Technology, Communications and Health Care will still
matter of course.
See Sector Coverage
for 2000 Relative Sector Weighting updates.
Additionally, 2001/02 favorites sectors include:
* A clear money manager favorite, but our SRI leanings do not incline us
to buy for clients. This Saturn/Pluto theme may also be played with Safety
stocks such as LoJak (LOJN).
Jupiter enters Cancer in July 2001. It will help "boring" consumer noncyclical
(IYK) as food companies such as Ahold (AHO) or Hain (HAIN). Other potential
Cancer themes include Home Depot (HD) and ocean hospitality such as Carnival
There is still some relative value in transportation stocks such as General
Motors (GM), Volkswagen (VLKAY) with its Euro kicker and Honda (HMC) for
its strong SRI pro environment products. Internet beneficiaries Fedex
(FDX) and UPS should be bought near value.
** We believe there will be at least one more US interest rate hike early
next year, so we are relatively cautious to negative on US Bonds for the
First Quarter 2001. Thereafter we recommend some accumulation, but
foreign investors may need to hedge periodic US Dollar under performance
Having my Moon in Libra, my Stock Selection is both:
TOP DOWN: country/currency, bourse/sector, individual
BOTTOM UP: strong astrological and/or fundamental/technical
I begin with one or more of the following 4 criteria:
A. FALLEN ANGELS: 68-90% from 52 week HIGH or
near 52 week LOW
B. CASH RICH, not stock rich (Survival of the
C. UNDERVALUED using Business Appraisal methodology
D. GOOD HOROSCOPE or in upcoming COSMIC SECTOR
1) Jupiter/Saturn conjunction (Value plus Growth)
2) Jupiter in Cancer
3) Saturn/Pluto opposition
FAVORITE 2001 STRATEGY HEDGING:
BUYING STRONG STOCKS/MARKETS and SELLING WEAK STOCKS/MARKETS
Unlike the first quarter of 2000, we will be looking more to cash rich
blue chips (companies that can buy back their own stock, e.g. ATT, IBM,
GM), than small and midcaps. As in 2000, our game plan is to invest
conservatively, but due to recent high market volatility, we will begin
to trade all accounts more actively. Five selected themes follow. For more
and updates, visit the AFUND
Positionally, we hedge by shorting the SPH and buying
strong stocks/sectors or by buying the SPH and shorting specific stocks/sectors
which should do poorly both from an astrological and/or technical viewpoint.
Initially, European stocks will rise and fall in sync with US markets.
However, later this year, as Euro appreciation becomes a secular trend,
global outperformance will result in Euroland.
1. The S:
Netherlands remain a favorite 2001 country as it is the single
best European country to prosper in a borderless Euroland. This is
due to both historic reasons AND the horoscope of the Dutch Stock Exchange,
as well as the individual charts of Phillips, Amro, Unilever, etc.
Buy EWN (Netherlands I-Shares or Webs) or select companies:
2. We always like undervalued stocks, especially those
with a yield greater than the classic value buy signal of 5% such as high
yielding S: REITs,
Goodyear Tire (GT) and Cemex (CX).
Netherlands (EWN) : Unilever (UL), Philips (PHG) and Ahold (AHO)
Germany (EWG) : Deutsche Telecom (DT), Deutsche Bank (DTBKY) and Bertelsmann
Japan (EWJ): Upon weakness, accumulate Kyocera (KYO), Matsushita (MC),
Sony (SNE) and Honda (HMC).
S: DJIA FAVORITE 2001 stock, i.e. hold/buy on
an intermediate-long term on a relative basis is IBM. As we expect
relative mediocre performance of Dow Stocks and Diamond Index (DIA), Blue
Chip stocks will have to be traded, not bought "buy and hold" for better
than single digit returns in 2001. Possible exceptions are: General
Motors (GM), T [Best performance for both likely in first quarter].
Second quarter on weakness, we plan on buying Home Depot and possibly
General Electric (GE).
4. FUTURE TECHNOLOGIES
(1) High possibility of a Philip Morris break up
in 2001 will do wonders for its stock price. We maintain our 2001 price
target of 42. Longer term trends, however, are disturbing, e.g. Air France
banning smoking on its flights.
(2) Microsoft (MSFT) continued battles until next
year's conference, although a strong buy by Fall 2001.
(3) T is sad, but we maintain our 12 month price
target of 42, although perhaps as a buy out candidate. :(
(4) Most likely replacement for Honeywell is Cisco.
Since before we became one of the first apple dealers in NYC, we historically
have liked betting on emerging technologies. This we recommend doing
in a basket of stocks. See our
FUTURE TECHNOLOGIES post. Our current three favorites are:
ROBOTICS: e.g. Int. Hi-Tech Industries (IHITF)* and Robotic Vision
BIOTECHNOLOGY: e.g Celsion (CELN) and StemCells (STEM)
SUCCESSOR ENERGY: e.g. Nuvera (NVRA) and Evergreen Solar (ESLR)
*5. AFUND CLIENTS
Business Astrologers know that the best way to predict the future is
to create it.
With strong disclaimers
with an obviously biased view, I am doing my best to help create investor
wealth for companies we now consult for, e.g. International High Tech Industries
and Cancall Communications.
Since May 2, 1988 I have established a superior forecasting
record, primarily due to my knowledge of financial astrology. While
not perfect as some critics would demand, my precision and accuracy is
appreciated by many professional traders and investors. As more of
our forecasting is now private and contracted to money managers and institutional
investors, it is my intention to have other financial astrologers and money
managers contribute more on my web site in the future.
(c) 2000, 2001 Please read our
The Astrologers Fund. No part of this report may be reproduced
or distributed in any form or by any means, except for brief passages quoted
for review without the prior written permission of the publisher.
ALWAYS CHECK WITH YOUR LICENSED FINANCIAL PLANNER
OR BROKER BEFORE BUYING OR SELLING ON THE RECOMMENDATIONS OF THE ASTROLOGERS
DISCLAIMER: PAST RESULTS ARE NOT NECESSARILY INDICATIVE
OF FUTURE FORECASTING ACCURACY OR PROFITABLE TRADING RESULTS.
The Astrologers Fund Accepts No Liability Whatsoever
For Any Loss Arising from Any Use Of Its Report Or It's Contents. The Astrologers
Fund Or Its Clients Usually Holds Positions In The Stocks and/or Market
Instruments Mentioned And May Buy Or Sell At Any Time Without Notice. This
Information Is In No Way A Representation To Buy Or Sell Securities, Bonds,
Options Or Futures.