You can't really say the market roared like a bull into new high ground this summer. A cowish meander might be more like it. Anyway, desultory is how the professionals around Broad and Wall Streets viewed the Dow Jones Industrials' push over 1340 in mid-July. And not without concern: Just about every money manager's portfolio contained sorely losing positions despite the rally. And, more worrisomely, few were venturing opinions as to what the next market play would be.

How could the Dow cross into greener pastures without drawing cheers from Wall Street? Well, in real-dollar terms, it didn't. Although the math for calculating that capitalization weighted average has undergond so many adjustments that by now it looks like the formula for sending Space Lab into orbit, the DJI can nonetheless be adjusted for the effect of inflation with some pertinence. Its chart may look impressive here, but if you factor the DJI using an uninflated dollar, it turns out that the Industrials haven't yet climbed back to the heights whence they plummeted on October 29, 1929. Not only that, but they haven't even returned to their 1937 top that followed the nearly five-year, 400% bull market that (many people are unaware) took place in the depths of the Depression. Whoever assumes that equities are out of the woods because the Dow is over 1300 isn't seeing the forest for the trees.

Wall Street traders' refusal to endorse the business boom that ought to have been signified by the historic high is most apparent in the INC. Index, which continued to lose ground even as the DJI pushed onward and upward. Market students who regard a divergence -- when one component of a given sector departs markedly from the others -- as suggestive of the next trend have to give the INC. Index serious scrutiny. Together with the NASDAQ Industrials, which also have been laggard, the failure of INC. companies to confirm the Dow's bullish adventure is saying to technical analysts not only that the stocks of smaller businesses are not participating in the upleg, but that they could be first off the mark in a general decline soon to follow.

On the other hand, the mood on the Street has been pretty dour for just that reason, and students who regard contrary opinion as indicative of the next trend have cause to believe that thinly capitalized stocks will not only join in, but could lead the thundering herd.