From Briefing.com Friday night: General Commentary
The month and the quarter ended on a bright note, as the Nasdaq recaptured 19 points, or slightly more than one percent... More importantly, Taiwan Semiconductor (TSM) announced that it was raising its capital spending plans for CY02 ... That is not a misprint... A tech company actually said that it was upping its spending plans... Needless to say the news received a warm reception in the influential semiconductor industry, with the SOX index adding 13.7 points, or 2.4%... While TSM is only one company, the announcement lent credence to Briefing.com's argument that the longer and stronger the economic recovery, the more likely we are to see a reversal in the miserable business investment trends... As corporate spending accelerates so to will earnings growth.
Though earnings growth in tech sector might lag a bit behind the rest of the market, early indications for Q2 are promising as about 20% of all positive guidance comes from the tech arena... Soft comparison periods and the underlying improvement in the economy also bode well... It's also important to recognize that the street tends to get it wrong at major inflection points... Just as many analysts were overstating growth/earnings prospects at the end of the bull market, they are probably understating earnings potential in light of the recent bearish trends... If our assumption is correct then we should see an increasing number of positive surprises not only in Q2 but in Q3 and Q4 as well.
Despite the more bullish economic tone and despite the more favorable earnings trends, the Nasdaq closed the quarter with a loss of 5%... Ongoing weakness in the networking/telecom space was largely to blame... However, as we noted in last week's Brief entitled Sector Seasonals Revisited, seasonals for the group are improving... To wit, Juniper (JNPR) led the group smartly higher on Thursday even though company issued an earnings warning... Could it be that the much maligned sector has finally put in a cylical bottom? If so, it will take considerable pressure off the Nasdaq, leaving the index positioned for a more upbeat second quarter.
Robert Walberg, Briefing.com
Sunday night:
09:04 ET Magnitude 6.8 earthquake hits Taiwan
A 6.8 earthquake struck 120 miles east of Taipei, causing some building collapses even in the capital, but Taiwanese chip foundries TSM and UMC both reported that operations were running normally after the quake.
18:48 ET NVDA NVIDIA on wrong side of shift in graphics sector: Barron's (44.16) A Barron's article suggests argues that Nvidia growth will slow as Intel introduces a new graphics chipset next month, competition from ATI Tech (ATYT) and Creative Labs intensifies, and PC sales growth remains sluggish.
finance.yahoo.com^SOXX&d=t
It appears that Yahoo is giving some incorrect delayed quotes. Everyone be careful before you believe what you see from only one quote source.
A thought occurs to me on TSM and UMC. Equake damage could actually have resulted in higher semi equipment orders. It may still result in even higher equipment orders.
RtS |
