TIU Investment Research, a Dublin based consultancy which specialises in US markets, has described last Friday's selling on Wall Street as "sensible profit taking in a ripe market". TIU believes that the American stock market can continue growing, but at a slower pace.

"Future stock gains will be selective, based on cautious stock picking in higher growth/less volatile market segments and based on business fundamentals. Taking this approach, the better performing segments in the first six months of 1997 will include telecom equipment, computer hardware, internet companies, computer software and services, recreation and sport, environmental and healthcare services," TIU said.

"Selective investment in the leading stocks in these segments should sustain an aura of `rational exuberance' which Mr Alan Greenspan nearly quashed," TIU added.