"Going forward into the New Year, our view...is positive," says Birinyi. Group performance in the last three months of 2000, he explains, doesn't suggest that prerecession characteristics exist. Moreover, during soft economic landings, the S&P 500 index tends to do well. (Birinyi Associates, December 2000)

Birinyi forecasts that the Dow Jones Industrial Average will hit 11200 by mid-2001 and finish the year at 13050. His price targets for the S&P 500 index and Nasdaq Composite sit at 1600 and 3450, respectively. (Birinyi Associates, December 2000)

There are eight stocks on Birinyi's Aggressive Accumulation list that haven't yet reached overbought levels. They are:

Charles Schwab

,

EMC

,

General Electric

,

IBM

,

Quest Communications

,

SBC Communications

,

Tiffany

and

Wal-Mart Stores

. (Birinyi Associates, December 2000)

Even a recession wouldn't necessarily cause a bear market, says Birinyi. Since 1945, there have been nine recessions, only five of which occurred at the same time as bear markets. (The Wall Street Journal, Jan. 16)

The strategist is concerned, however, about the arguments underpinning the bullish case for 2001. "The rationale isn't well developed," he says. "It's all about the Fed." (Barron's, Jan. 1)

Most technology stocks, especially many major Nasdaq names, "do not exhibit the circumstances that would suggest a sustained recovery," says Birinyi. However, there are some notable exceptions: Money flows into

Microsoft

indicate better "but not necessarily great" moves.

Qualcomm

, he says, is likely to outperform and is suitable for aggressive investors even at current levels. (Birinyi Associates, February 2001)

Money flows suggest to Birinyi that consumer cyclicals will likely do well going forward. (Birinyi Associates, February 2001)

The strategist has dropped Charles Schwab, Tiffany, EMC and General Electric from his Aggressive Accumulation list. New additions include

Apache

,

Bristol-Myers Squibb

,

Coca-Cola

KO

,

Deere

,

Dow Chemical

DOW

,

Fannie Mae

,

Goldman Sachs

,

Johnson & Johnson

,

Morgan Stanley

and

Nike

. These stocks are trading in or below their normal trading range. (Birinyi Associates, February 2001)

No predictions or research issued.

April 2001

Birinyi is still bullish on stocks because money flows on the Dow Jones Industrial Average are positive. He also notes that once the market has declined by 20%, the greater part of the damage has usually been done. (Birinyi Associates, April 2001)

That said, Birinyi has a negative outlook on the Nasdaq Composite, where there's been continued net selling. (Birinyi Associates, April 2001)

Investors are doing more sustained buying than they did this January and in June of last year, according to Birinyi. In fact, he sees signs that smart, professional investors were quietly building positions in some stocks before the April rally began. That kind of activity, he believes, can mean that the gains will be long lasting. (The Wall Street Journal, April 23)

Birinyi thinks the Nasdaq Composite has bottomed and expects it to trade within a range of 1900 to 2100 this year. No longer is the Nasdaq characterized by net selling, he explains. (Birinyi Associates, May 2001)

Although the S&P 500 index is at the top if its trading range, money flows into its stocks remain positive. As such, Birinyi says the market "should trade higher, not sideways." (Birinyi Associates, May 2001)

Birinyi has added the following stocks to his Strong Accumulation list:

Amerada Hess

,

American Home Products

,

Caterpillar

,

Dollar General

,

Dynegy

, EMC,

Neuberger Berman

and

Smith International

. (Birinyi Associates, May 2001)

No predictions or research issued.

July 2001

The market is poised for a rally, says Birinyi. "Whether it is in reaction to a move by the [Federal Reserve], better-than-expected second-quarter earnings or even an oversold condition, we would be buyers here." (Birinyi Associates, July 2001)

The market shows a preference for large-cap stocks over midcap and small-cap stocks, says Birinyi. (Birinyi Associates, July 2001)

Stocks under the strongest accumulation include:

Alcoa

,

Anadarko Petroleum

,

Baker Hughes

,

Citigroup

,

Circuit City

,

Cypress Semiconductor

,

Fleet Boston Financial

,

Lehman Brothers

,

Marriott International

,

3M

,

National Semiconductor

and

Weatherford International

(Birinyi Associates, July 2001)

Birinyi thinks investors should look for stocks with dividends. Four he recommends are

CMS Energy

,

ChevronTexaco

,

People's Bank

and

Consolidated Edison

. ("Wall Street Week With Louis Rukeyser," July 30)

No predictions or research issued.

September 2001

Birinyi now expects only a small market gain this year. His new target for the Dow Jones Industrial Average is 11000. Sentiment is too positive, lower interest rates haven't taken hold, no market leadership exists and the recovery in equities since April has been small compared with past post-bear market rallies, he explains. (Birinyi Associates, September 2001)

It appears "increasingly possible" that the market may again test and breach the April 4 low of 1103, extending the bear market, Birinyi says. (Birinyi Associates, September 2001)

Tech stocks appear to be stabilizing relative to the broader market, says Birinyi. And the fact that the technology sector has experienced a greater-than-normal correction suggests a trading rally, if nothing else. (Birinyi Associates, September 2001)

The 11% rise in the Dow Jones Industrial Average from Sept. 11 to Oct. 3 was only the 10th such move in an eight-day span since 1970, according Birinyi. After nine of the 10 prior 11% advances, the Dow was higher six months later. (Barron's, Oct. 8)

Birinyi now thinks the Dow Jones Industrial Average and the S&P 500 index will reach the top end of their current trading ranges of 10000 and 1200, respectively. Money flows are positive, and most key sectors show net buying, he explains. (Birinyi Associates, November 2001)

Communications-equipment, brokerage and computer-software stocks are nearing their historical highs, suggesting they may be overextended, says Birinyi. However, the long-distance, electric and telephone sectors are at or near historical lows, which may indicate they're ready to turn. (Birinyi Associates, November 2001)

The recent rally in technology is reminiscent of other rallies this year that have proven to be temporary, says Birinyi. (Birinyi Associates, November 2001)

The best indicator of a market bottom is sentiment, says Birinyi. Analysts, strategists and technicians are universally negative at market bottoms. "We do not see this today, as targets, while lowered, are still positive; asset reallocation favors stocks; and commentators examine every data point or economic release for indications as to the timing of recovery." (Birinyi Associates, November 2001)