Klee: Tech Sector 'Due for a Pause'
DEBORAH MARCHINI, CNN ANCHOR: A mixed picture for the Nasdaq big caps there, but not for the index.</s>DAVID HAFFENREFFER, CNN ANCHOR: I'll say. And on the heels of the record highs, the Nasdaq experiences its fourth-worst point loss. So aside from upset stomach and indigestion, what does this volatility mean for investors?</s>MARCHINI: To help answer that question we have technology manager Mark Klee of John Hancock Mutual Funds. Mark, great to see you again. And what exactly was it that we witnessed yesterday?</s>MARK KLEE, JOHN HANCOCK MUTUAL FUNDS: You want to know something? I really think it was more the retail investor got spooked out by what went on in Asia, moved on to Europe, and then it came here. Because if you look at what happened on the opening, the Nasdaq was down 209, and we had, actually, a fairly orderly market after that. And as somebody who is not really that concerned with the short- term moves, because I am a long-term investor, I was actually kind of pleased with yesterday's action, overall.</s>MARCHINI: Were you buying?</s>KLEE: Yes, I was. I'm not going to tell you what I was buying, but, yes, I'm actually feeling pretty good about things. I mean, we're very disciplined buyers, and we've been waiting for some periods. And, you know, stocks like Dell have been giving us opportunities for the past few months, and we've been buying and buying and, you know, now we're getting rewarded on that. But I think you have to pick your spots and do it, and I think yesterday gave you those opportunities.</s>HAFFENREFFER: You said it was the retail investor getting spooked. Hasn't it been the retail investor that's been sort of the stalwart of patience through this -- the rocky times?</s>KLEE: Yes, he really has been all along, and that's sort of the interesting thing about yesterday. I think Mondays, in general, are kind of a strange thing. You read...</s>HAFFENREFFER: Mondays and Fridays, right?</s>KLEE: Yes. Well, Friday afternoons, nobody wants to be long over the weekend, but I think that's more institutional. I think Mondays -- you read "Barron's" over the weekend, you read the "New York Times" over the weekend, and you walk away from there generally scared because they've had a generally negative tone to them. And then, like I said, you had Asia and Europe on top of that. But the fact that we really rebounded very quickly, and then we sold off towards the end, but I thought it was a generally, orderly market given what's gone on in the last few weeks. I mean, obviously, the last 18 months have been spectacular in technology, but the last few weeks, we've been in another spike. I think we're due for a pause in here.</s>MARCHINI: Earnings season is coming upon us, and before earning season comes warnings season. What do you think we're going to see?</s>KLEE: Actually, I would have thought that we would have a big sell-off in March. I think you and I talked at year-end, what was my forecast for this year, and I thought that we would have a pretty good run through January and February, and then, around mid-March, which is obviously where we are, here we are approaching the ides of March...</s>MARCHINI: The ides, right.</s>KLEE: ... that's it -- I thought we would get a pretty good selloff because of lack of news and, if anything, bad news just from the preannouncement as we go into that season. I don't think we're going to get many. You know, companies like Oracle that report in the off-season I think are going to report good numbers, and I think they're going to tell you that business is good. And most interesting is the PC business. We have seen good reports starting mid-to-late February, and, if anything, business is improving. So I think we're going to have very few preannouncements.</s>HAFFENREFFER: You mentioned liking Dell. What other names do you like?</s>KLEE: Big caps: America Online, I think, is giving you a big buying opportunity in here. And, you know, the stock has moved up a little bit, but I think you can still buy that. I like Computers Associates, another big-cap name. I'll tell you the truth, I've generally been preferring small-to- mid cap names, but those are a few of the bigger ones. Some of the smaller ones: Applied Science and Technology, Amcore, companies like that in the semiconductors space. And a little special situation, a company called Bluestone Software, which is what's known as a middleware software company, which sort of bridges together different computer systems.</s>MARCHINI: Mark Klee, don't go far please, we're going to have you back in the next half-hour. I, for one, want to know, as you're out there buying tech, whether you agree with those who believe the old-economy stocks are dead. Don't answer it now, hold that thought.