What part of last night's upbeat news from the software sector doesn't compute?

Siebel Systems (Nasdaq: SEBL) topped Wall Street's top- and bottom-line targets. Rival Oracle(Nasdaq: ORCL) -- which always likes to mix it up when Siebel takes the stage, like a pair of jealous, tiara-fumbling, runner-up prom queens -- reaffirmed its fiscal third-quarter guidance. Computer Associates(NYSE: CA) came through with a narrower-than-expected loss.

Like a soft-drink vending machine in a barren desert, the forgotten enterprise software sector is offering up a refreshing treat after two years of nothing but trouble. Once the economy began to go soft, software upgrades went out the window. Penny-pinching corporations held back on new purchases, the butter on the bread of the computer software industry. Software proved to be a hard sell, despite arguments by companies like Oracle that implementing their business solutions would save more money down the road.

That's why last night's roundup had to bring a smile to your face as you dropped your coins in the soda machine for a cool bottle of...

Pfffft! Sand!

Yes, there are no sodas in the desert. It's a mirage. Sure, Siebel cleared the bar, but its software sales still came in 37% lower than last year's showing. While Computer Associates managed to fare better than last year, it's also unscrewing the hydrant to hose down its current-quarter projections. And Oracle's struggling to sell its application software suites.

So just like Microsoft's(Nasdaq: MSFT) rather bleak near-term outlook, the software sector is still risky, regardless of the fact that shares of Siebel, Computer Associates, and Oracle have each risen roughly 50% over the past three months. If anything, it signals that bottom-fishing season ended back in October, and the fundamentals still aren't nibbling on the hook.