Quad-City Times from Davenport, Iowa • 25

The Motley Fool B8 Key 15Jim Victor B9 Local interest B9 Mutual funds BIO Business Editor: Deborah B7 Quad-City Times Brasier (563) 383-2452 Sunday, July 15, 2001 Funds i 1 (' Tech stocks sizzle i CInetech, based In Yorkville, Jeff CookQUAD-CITY TIMES is remodeling the former Super Saver Cinemas In Moline. movies! Analysts aren't putting money on sustained rally NEW YORK (AP) Technology stock shareholders are enjoying a nice bump up in their portfolios thanks to triple-digit rallies in the Dow Jones industrials and Nasdaq composite index, but the bad news isn't over yet for the sector or the broader stock market. Market experts say the gains Thursday and Friday were more attributable to bargain hunting and relief over some weak, but not terrible, earnings reports, rather than any fundamental shift in the business environment And, like previous rallies this year including this spring's huge rally, this advance will eventually fizzle. "These are the same stocks that have sold off precipitously over the last few weeks, so this could just be a technical bounce, people buying on weakness," said John Forelli, portfolio manager for the John Hancock Core Value Fund. "I think it's too early to say we've seen the worst." Thursday's rally came after Motorola and both closely watched technology companies, reported second-quarter earnings that were slightly better than analysts had been predicting.

The problem: Wall Street's expectations had been low to start with, so beating those num- bers wasn't a big deal. Also, both companies failed to say when I their businesses would improve and, in the case of Motorola, -warned that the next quarter would be disappointing. But investors set aside those worries and opened their wallets. Motorola rose 15.8 percent Thursday while Yahoo climbed 7.2 percent. Wall Street was just as generous with Microsoft, which rose 7.7 percent after the software giant said quarterly rev- enues would be better than expected.

All three stocks retreated Friday in an expected giveback after, their big gains, but the Nasdaq and Dow still managed to end the session higher. The Dow rose 60.07 to 10,539.06, compounding its 237.97 point gain Thursday, while the Nasdaq advanced 9.05 to 2,084.79 Friday, adding to its 103.70 run-up in the previous session. Thursday's gains were the biggest point gains for both indicators since mid-May Still, as dramatic as the advances appear, the Dow is barely at the level it was two weeks ago and the Nasdaq has yet to catch up. The reason: incessant selloffs on the string of corporate warnings and job cuts leading up to the beginning of second-quarter earnings reports last week. Most analysts agree that technology's glory days of 1999 and early 2000 aren't likely to return anytime soon because companies still aren't reporting healthy profits or strong business results.

Investors also have become a lot more discriminating. Much of the significant tech gains Thursday were in big, high-profile tech companies with established tech records, rather than start-ups. "We're in an environment where investors are going to pay a lot of attention to earnings, and that's going to put pressure on this sector," said Richard Cripps, chief market strategist for Legg Mason. I Buck Kolkmeyer's company, Ticket price at QC theater will include popcorn, pop By Chris Youngquist QUAD-CITY TIMES Film will roll again soon at the former Super Saver Cinemas complex in Moline, just six months after National Amuse-We re trying mentslnc. to make it closed the cc Li bargain-allordable priced the- for a family ateritoper- ated there.

Of four to see YorkvUle, a movie for DL-based theater about 3o. company BUCK KOLKMEYER NovaCine- Nova Cinetech cn Ts signed a lease and is furiously redecorating in an effort to have the Nova 6 Cinema ready for screenings by July 27, its president, Buck Kolkmeyer, said. Undaunted by theater giant National Amusements' January closing of the cinema For a few online THE WASHINGTON POST Not many stores draw more than 1 million shoppers a month. Apart from a Mall of America or Walt Disney World, few commercial venues of any kind have that kind of pull So it's fascinating to note that more than 600 Web sites are drawing 1 million visitors a month, despite the dramatic consolidation on the Internet and the wipeout of many dot-coms. That's the latest tally from Jupiter Media Metrix, which measures Web audiences.

In May, Media Metrix found that 641 Web sites broke the million-visitor mark. You might be surprised, for instance, to learn that 2.3 million people stopped by Nova Charles Jaffe Viewpoint Be aware of changes in index If you like index funds, you probably think you know what goes into a Standard Poor's 500 version. Mostly, it would be the 500 stocks that make up the index. But the answer's not that simple, and at least one prominent financial expert believes you ought to know more about how the index is constructed before you buy it. In the June issue of Money magazine, columnist Jason Zweig asked the question "Is the 500 rigged?" While his analysis came to the conclusion that it wasn't, it also highlighted some trends in the index that deserve some scrutiny.

What the article (it's listed among Zweig's "recent columns" at investingfundamentalist) didn't answer for fund investors is the question of which index is the best to use if you want to add a represent-the-market centerpiece to a portfolio. Zweig is quick to point out that the doesn't represent the nation's 500 largest stocks. Instead, it's simply a listing put together by a committee to represent an economic benchmark on the overall market. Truth be told, if committee members started their own fund, they'd have a mighty impressive track record as managers and many people would want to own their fund, but that's not what the is about. Their mandate isn't managing a fund, it's building a portfolio that reflects the entire stock market and the economy.

Unlike other indexes like the Russell 2000, which regularly changes component companies as they grow or shrink, membership in the 500 has been stable over the years. In general, most companies that got on the list stayed on, barring merger, acquisition, or bankruptcy. Occasionally, a stock that had shrunk would be dropped. Such moves were rare until recently, which is where Zweig's analysis comes in. He noted that last year, the committee threw out 18 stocks more than 1 in 30 of the index holdings and the highest total in its 75-year history due to fallen market value.

Activity of that kind has picked up since 1995. As a result of the changes, Zweig argues the 500 has become more weighted toward technology and skewed toward growth companies. What's more, he contends the current 500 shouldn't be compared to the version of just a few years ago because, statistically speaking, the characteristics of the index have changed dramatically. For their part, Standard Poor's officials reject the contention that anything unseemly is going on, noting correctly that the market as a whole has seen a tilt toward technology and that their index remains underweight in tech stocks relative to the market. Moreover, they contend the benchmark index remains a solid indicator, filled with all of the leading companies from all of the leading industries.

The crucial thing for a JAFFE Please turn to Page B10 If BBS theaters with similar policies, he said, adding that the free food provides a kind of tradeoff for the lack of stadium seating, which has grown popular in recent years. The Showcase Cinemas on 53rd Street, Davenport, have stadium seating, but the Milan, III, Showcase Cinemas have rocker seats. Armed with paintbrushes and power tools, Nova Cinetech workers, including interior designer Kim Kolkmeyer, are hurrying to mod- ernize the art-deco style theater, with brass wainscoting on the walls and blue and gold carpeting. "I'm just trying to give it a little more elegant look," Kim, who is Buck's wife, said. Her husband said he was made aware of the theater's availability through an acquaintance, and, with the collaboration of the landlord, who made a "substantial investment" to revitalize the property, he expects to make money by drawing high numbers of movie-goers.

The company, which formed this year with the consolidation of four, existing busi- is a million (or thousands of Web sites are building sizable audiences. Media Metrix found that 1,435 Web sites drew more than half a million visitors in May, and 2,995 pulled more than a quarter-million through their virtual doors. Media Metrix gets its figures by signing up volunteers and watching what they do online through meters attached to their computers, then extrapolating those numbers to the overall US. population, much as TV rating companies do. It's a cinch to see why drew 1.2 million gawk-ers in May (its anchors strip while reading newscasts), but who would have guessed Nabisco's Candystand.com would attract 1 million folks to its mini-golf and extreme stunt-bike games? Or nesses, is still in the process of scheduling the first round of movies for the theater.

Nova Cinetech operates about 75 screens at 15 first-run cinemas, including two drive-ins, in locations such as Branson, Rochester, and Boaz, Ala. Kolkmeyer said about 15 full and part-time employees will be hired for the new theater, beginning next week. Those interested in interviewing should call the theater at 743-1157. (That phone number was not in service as of Saturday afternoon.) The Super Saver Cinemas opened in 1986 under the operation of Movie One Theatres Inc. of El Paso, Texas.

Two years later, National Amusements bought the business, giving the Dedham, based chain control of all Quad-City theaters. The Showcase Cinemas on Brady Street, Davenport, closed in December. Chris Youngquist can be contacted at (563) 383-2360 or cyoungquistqctimes.com. so) clicks away that after the death of Pets.com, a virtual animal world called NeoPets.com would be drawing more than 1 million people to create and play with imaginary pets? No one really knows the business potential of Web traffic. But it is interesting to compare Web traffic with visitor trends at offline venues such as shopping centers and tourist attractions.

Mind you, it's a more serious commitment to leave the house and visit a physical store than it is to click on a Web site, and off-line commercial venues usually make money, while few Web sites do. Nonetheless, consider that more than 1,400 Web sites are drawing more traffic than the nation's 1,800 enclosed shopping malls. BBS company officials cited lackluster ticket sales he hopes to draw crowds with larger, rocker-style seats, digital sound and a novel pricing strategy. Kolkmeyer said he is not trying to compete with the Showcase Cinemas in Davenport and Milan, 111., which have held a virtual monopoly on Quad-City movie screening for more than a decade. "My intent is to provide Moline with a neighborhood theater," he said, adding that Moline is populous enough to support its own movie house.

"We're trying to make it affordable for a family of four to see a movie for about $25." Toward that end, popcorn and a regular size fountain drink will be included in the cost of each ticket, and, rather than operating a separate box office and concession stand, refreshments and tickets will be provided at the same place. Other concessions, such as nachos and candy, will be sold as well. "We think there's a niche for this type of pricing," he said. His company manages other sites, success MyHomeKey.com, which schedules home repairs and maintenance. And that nearly 3 million went to eDiets.com, where more than 250,000 people are paying a monthly fee for custom weight-loss programs.

Although a Web visit is a lot easier than a physical visit, it's noteworthy that eDi-ets logged more visitors than Potomac Mills Mall in Wood-bridge, which drew 2.5 million shoppers in May and is Virginia's largest tourist attraction. The giant portals still dominate Web traffic in fact, the top 14 Web sites account for roughly 60 percent of all time Americans spend online, according to Media Metrix. But with all the publicity over Internet companies folding, you might never guess how many had grown up on a dairy farm and had adapted to changing times raising thousands of cattle over 30 years, but he wasn't keen on "tinkering with Mother Nature." A visit to Infigen a biotechnology firm here that had contacted him, erased his doubts. He saw healthy-looking cloned animals and gave the thumbs-up. "I guess as you get older, you open your mind a little," the 69-year-old Bader says.

"Years ago, this would have been a Buck Rogers-type thing. You wouldn't expect that it would ever happen." 0X1 But it did. Dolly proved that. The birth of the sheep in Scot Cloning debate rages in the lab, on the farm V-v DeFOREST, Wis. (AP) She has a case of silver trophies and blue ribbons and in almost every show she has entered, she has walked off a winner.

Mandy is a celebrity and she seems to know it. Her name has generated big buzz in Holstein circles. Her pedigree is impeccable, her production of milk nearly twice that of the average cow. So it seemed natural when her owner got the call. One Mandy was great, so how about a clone? Think of it.

Those strong legs. That broad chest. That large udder that seemed welded under her belly. What about a carbon copy of this all-star bovine? Ron Bader wasn't sure. He land in 1996 the first mammal cloned from an adult was a landmark, turning the stuff of science fiction into a four-legged reality.

Dolly offered a new way of reproducing and genetically modifying animals, a technology some say could ultimately save thousands of lives and generate billions of dollars. Critics, however, say cloning is fraught with too many unknowns and possible hazards. A recent study in the journal Science reported that scientists doing cloning experiments found that even apparently normal animals develop disorders later in life. Those reservations haven't CLONE Please turn to Page B8 ASSOCIATED PRESS from his cloned from cells taken Texas rancher Ralph Fisher dodges a lick bull, Second Chance. The bull was cloned from Fisher's deceased Brahman, Chance, 4-.