Investors are divided over whether the Dow's 10,000 milestone on Monday signals a further boom or the long-expected bust.
American Banker interviewed several retail investors at the downtown New York offices of Quick & Reilly, the brokerage unit of Fleet Financial Group, and at Charles Schwab & Co. on Tuesday.
While some are betting the bull market will continue, others were wary of what they see as overvalued stocks.
"People have been saying the bubble is going to burst since the Dow hit 5,000 - and now it's 10,000," said Steven Kigel, a day trader, who was clearly one of the optimistic ones. "Until it stops, you have to be on board."
"More money, more money," said Brian Kirk, an account executive in the sales department at Time Warner Telecom. Mr. Kirk's enthusiasm was clearly reflected in his portfolio, which has a 60% weighting in stocks included in the Dow Jones industrials.
Others were a little more cautious.
"It's not a true reflection of earnings," said Matt Mays, a speculator, who estimated that stocks could fall 10% to 15%.
Several investors said they expect a correction within a few months.
"I wouldn't go into shock if it went to 10,500 or 11,000, but I think there's going to be a correction somewhere down the line," said Tom Cahill, a bond broker at Cantor Fitzgerald in New York. He estimated that the Dow could fall as low as 8,500 "before it comes back up."
Individual investors seemed well educated on market fundamentals.
Several investors said the Dow's future depends on several factors, including interest rates, inflation, and the situation in Yugoslavia.
"As long as things seem to be favorably disposed toward the U.S., I think the market is simply going to continue going upward," said Michael Zlotnick, an accountant at J&R Music World.
One brokerage customer said the market would probably dip in October because of year-2000 concerns. "Everybody will get a little nervous," said Celia Tepper, a consultant to the telecommunications and financial services industries.
But none of those interviewed expressed concern about a stock market free fall.
"People aren't going to cash out," said Mr. Zlotnick, the accountant. "This is the best place to keep your money."
Though he said there may be a bit of a "roller-coaster ride" in the next six to eight months, Mr. Kirk, the account executive, said he was not overly concerned.
Some investors were actually hoping for a slight correction.
Mahabal Shah, an engineer, said he won't buy more stocks until the market drops at least 5%.
Another investor said he hoped the Dow would fall because his small-cap stocks are losing money and it is too expensive to buy large-capitalization equities. "I'm waiting for the crash," said Kalpit Patel, who is also an engineer.
Despite the hype surrounding the 10,000 milestone, several investors said they would not change their investment strategy.
"If you listen to six people, three say it's going down, three say it's going up," said Joseph LoGuidice, a registered insurance rep at New York Life Insurance Co.