PALO ALTO, Calif. (CNN/Money) - If you read only the headlines, you just might think there's lots of good news out there. Dig a little deeper and you find as many reasons for concern as ever.

Let's start with the happy stuff. First, the obvious good news: On Wednesday, the Dow rallied 173 points, or 1.7 percent. Why? Well, the prevailing wisdom was that since stocks had been tanking, they must be cheap. Pretty lame -- kind of like when investors "take profits" after a run-up. It's another way for investment analysts to say, "Beats me," which doesn't sound very good on television.

But there were plenty of other pockets of optimism. Sears (S: up $2.98 to $54.18, Research, Estimates) raised its first-quarter earnings expectations (see more).

Ditto for Lands' End (LE: down $0.16 to $49.84, Research, Estimates), (where, I might note, I logged lots of hours as a part-time clothes salesman in high school...the stories I could tell...). Consumer products maker Dial (DL: up $0.51 to $20.11, Research, Estimates), also says the first quarter is looking better than expected. Oh, and Jet Blue, Wall Street's favorite new airline, boosted the price of its expected IPO, a sign that demand for shares from institutional investors is strong (see more).

Even Tuesday's bad news became better. Analysts jumped to the defense of Cisco, arguing, among other things, that Cisco has plenty of time left in the quarter that closes this month to make its numbers. The fear that it wouldn't knocked the stock down on Tuesday.

Have things improved in the Middle East and someone forgot to mention it? Fears about the broadening Israeli-Palestinian conflict were enough to sock stocks last week. The situation persists, but there was nary of mention of it in the overall market coverage today.

Read comments by Sears closely and you'll see CEO Alan Lacy saying that "while revenues continue to be soft, our focus on gross margin, inventory levels and operating expenses is driving substantial profit improvement." Oh great. Remember -- profit growth through cost-cutting isn't nearly as good a sign as profit growth stemming from improving sales. (3M's improving forecast last week, which was also a big deal, was also attributable mostly to cost-cutting.)

There isn't much bad to say about Lands' End and Dial. Hurray for them. Jet Blue is a small fry, and there's always room for a well-run small fry.

As for Cisco, here's my favorite gem gleaned from Wall Street's full-court defense Tuesday. Merrill Lynch analyst Samuel Wilson, who rates Cisco a buy, notes that the company is currently worth about 6 times trailing sales and 29 times his calendar-year 2003 earnings estimate of 51 cents per share. He thinks 40 times 2003 earnings would be more appropriate, "making a price greater than $20 likely over the next 12 months."

Isn't it those kind of aggressive forecasts that got us into trouble in the first place? Ah, never mind. Today we're HAPPY.

In Monday's column, I riffed on IBM for deciding not to say a whole lot in terms of guidance. That led venture capitalist Lise Buyer to whip off the following response. Lise has toiled in the past for T. Rowe Price, Deutsche Morgan Grenfell and Credit Suisse First Boston -- and she's worth listening to. Take it away Lise:

RECENTLY BY ADAM LASHINSKY       If you can't say something nice... My own investing hell Funny money is alive and well

"With 15 years of public equity analyst experience, I think the call to get rid of guidance should be tattooed on every CFOs forehead. Way back when, companies offered very little help with the numbers (other than anticipated unusual events), and the analyst's job was a) more interesting, and b) more often accurate.

"Analysts who did real homework were discernable (at least sometimes) by the higher quality of their work. Once the guidance game picked up speed there was little room for original thinking or for flexibility. Both Netscape and Amazon played this game brilliantly early on by talking numbers down so that there could be a bigger upside surprise. There would have been some surprise anyway as none of us had ever seen businesses grow that fast, but the magnitude would certainly have been reduced. That which was ostensibly offered to help analysts became a corral for the good ones and a safety pen for the others."

Nicely put.

Adam Lashinsky is a senior writer for Fortune magazine. Send e-mail to Adam at adam_lashinsky@timeinc.com.

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