We'll probably trend a little bit lower [in the next couple of weeks]. A lot of the gains have been on positive comments made by companies like Dell and IBM, but I think a lot of this reflects market-share shifts rather than a recovery in the overall market.
Valuations remain a little stretched, and we could see some further weakness into the early part of the year.
In spite of the Gateway announcement, there seems to be some firming in demand for PCs and flash memory. Pricing is starting to improve. And for IT services, capacity utilization is finally starting to improve.
I don't see how the company can have that kind of visibility, especially with a management team that had to revise earnings three times within one quarter last year. They don't have credibility.
Software companies have sold off aggressively but some information technology managers have indicated a willingness to spend in that area.
Potential customers have more faith and confidence in the financial health of IBM.
I don't think there's enough evidence to support the argument that there is a recovery in information technology.
I don't really see [today's bad corporate news] as significant fundamental factors, I see it more as an excuse for short-term profit-taking. The correction we've seen is very small relative to the rally we've seen in the last few weeks.
A quicker-than-expected recovery in capital expenditure spending will probably be the biggest catalyst, if one occurs at all.
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