Interesting excerpts from investment newsletters:

"When the positive psychology finally gives out, declines could be substantial. It's critical to be on the alert for signs of change. A downward-trending pattern of trading cycle highs and lows, for example, would likely mean the dip-buying phenomenon is wearing thin. Prolonged weakness in big-cap technology stocks could indicate that a leadership vacuum is forming. Obviously, evidence that inflation is heating up should be viewed with caution. Until then, we would stay with a bullish policy."

-- Investor's Monthly,

Standard & Poor's,

New York

"The cycle . . . is not yet over. No one can predict which sectors of the market will emerge as the leaders. A good argument can be made that the growth and Internet stocks are just undergoing a normal and healthy correction. Once the dust settles and these stocks build new bases, they could be off to the races again."

-- Dan Sullivan,

The Chartist Mutual Fund Letter,

Seal Beach, Calif.

"Although investors remain concerned by high stock valuations, there are favorable . . . numbers that show the economy is growing at a higher rate than was forecast, which should support higher corporate earnings. . . . Although many continue to express caution, our top ten timers remain optimistic; the consensus of the top ten is bullish, with 9 Bulls and 1 Bear."

-- James Schmidt,

Timer Digest,

Greenwich, Conn.

"The market is incredibly overvalued by traditional standards. Investors are worried about the return of inflation. Treasury Secretary Robert Rubin has resigned. . . . Why does the market continue to reach record highs? Because most companies are doing a great deal better than expected. The stock market is telling us the earnings picture for this year is bright indeed. The message is that surprises for this year, once again, are going to be on the upside. Stay fully invested."

-- Carlton Lutts,

Cabot Market Letter,

Salem, Mass.

"The threat of higher rates and the reality of marginally higher inflation will sustain big stocks' loony valuations and keep the Fed on hold. But more growth will allow the vast majority of stocks, the ones that have been lagging over the past five years, their time of glory."

-- Stephen Leeb,

Personal Finance,

McLean