I think the order of recovery will be cyclicals (already in progress and should continue for a while), consumer durables (including electronic gadgets), chip makers (all areas except telecom/networking), chip equipment makers and telecoms, networking and their chip makers.
This doesn't mean that one sector will move up while others decline or do nothing. Rather it is a call on the relative timing and relative strength of each sector. In other words, unlike what I hear from everyone that "tech" leads, I think it will be the old economy that will lead. Yes at the bleeding edge there will be improvements, but by definition, that is a small market.
There are two reasons for this call. The first is that none of the CEOs are likely to approve major capital spendings for the next nine months. The other is that over capacity in production lines will take some time to work its way through the recovery. In case of telecoms, there is the added problem of lack of financial strength. 3G wireless for example is being pushed out even more than expected. The same goes for major networking projects.
All this means, IMO, that it'll continue to be a buyers' market for the rest of the year and the further up the food chain you are, the better off you will be. By all means, feel free to criticize this perspective.
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