Chip stocks tumble on nuclear incident, memory prices
biz.yahoo.com
SAN FRANCISCO, Sept 30 (Reuters) - Shares of semiconductor makers tumbled on Thursday as investors worried about the potential impact from a nuclear accident in Japan and a drop in memory chip prices, analysts said.
Japanese officials said 27 people were treated for radiation exposure in the country's worst-ever nuclear accident at a Japanese uranium processing plant about 90 miles (140 km) northeast of Tokyo on Thursday.
Analysts and traders said that investors were worried that the nuclear incident may affect chip companies with big manufacturing plants in the Tokyo area. Investors were already nervous about a bigger-than-expected impact on chip makers and PC makers after the Taiwanese earthquake last week
Amid a broad drop in the sector, LSI Logic Corp. (NYSE:LSI - news) fell $5 to $51.50 on the New York Stock Exchange; National Semiconductor Corp. (NYSE:NSM - news) closed down $2.31 to $30.50 on the NYSE; Cypress Semiconductor Corp. (NYSE:CY - news) lost $4.375 to $21.50 on the Big Board; Atmel Corp. (NasdaqNM:ATML - news) declined $2.56 to $33.81 on Nasdaq; and Xilinx Inc. (NasdaqNM:XLNX - news) eased $1.68 to $65.53 on Nasdaq. Chip giant Intel Corp. (NasdaqNM:INTC - news) was off $0.875 to $74.625 on Nasdaq.
''The stocks were a little weak when the day started, and the news about the radiation leak in Japan served as a catalyst for people to take profits,'' said one technology stock trader.
Milpitas, Calif.-based LSI Logic has a chip manufacturing plant 55 miles from the incident in Japan, but said everything was ''business as usual,'' at its plant in Tsukuba.
''There is a significant range of mountains in between the (LSI) site and the accident,'' said Kevin Brett, an LSI spokesman. ''I just talked to our executive vice president of worldwide manufacturing, who said there is no impact.''
Micron Technology Inc. (NYSE:MU - news), the biggest maker of memory chips in the U.S., was among the most actively traded stocks on the NYSE, losing $5.4375 to $66.5625. Traders cited fears about the accident in Japan and a recent decline in memory chip prices.
''We have a plant in Japan, but it is unaffected by the disaster,'' said a spokesman for Micron in Boise, Idaho. ''It's not very close at all. It's in the Kobe/Osaka area.''
Some analysts said investors who worried about a recent decline in memory chip prices were overreacting. Erika Klauer, an analyst at Deutsche Banc Alex. Brown, said she remains positive on the semiconductor industry.
Spot prices for 64-megabit memory chips are about $18.50 currently, according to Paul Meyers, a memory commodity manager at the American IC Exchange in Aliso Viejo, Calif.
Prices had spiked to about $21-$22 immediately following the Taiwanese earthquake.
''By early next week, prices should be rebounding,'' Meyers said. ''It's the end of the month, and people are trying to reduce their inventories.''
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