Ebb & Flow

Four weeks into the New Year and the NASDAQ Composite is on a tear, leaving all of the other indexes, including biotech, in the dust (see "Eating Dust"). The BioCentury 100 has fallen 4 percent compared to the NASDAQ's 13 percent jump, raising the question of whether some of the movement is due to rotation from biotech to tech.

Mitch Silber of Thomson Financial/Carson doesn't see biotech money rotating out of the sector. He does see money that was on the sideline rotating back into NASDAQ after the Federal Reserve Board's surprise 50 basis point reduction in the discount rate on Jan. 3. He also believes that investors are putting money into the Composite on the assumption that the Fed will institute another 50 basis point cut when it meets on Tuesday and Wednesday this week...