Here is a group, World Semiconductor Trade Statistics Group, that just made the following press release.
wsts.org
<<WSTS Semiconductor Market Forecast World Release Date: 1 June 2004 - 6:00 UTC
Miyazaki, Japan, Spring Forecast Meeting 18 - 21 May 2004
From The WSTS Board Of Directors:
According to the World Semiconductor Trade Statistics (WSTS), the world semiconductor market reached a size of $166B in 2003. During the previous forecast meeting in October 2003 a number of $161B was projected. Already the fourth quarter of last year has indicated a stronger momentum of recovery than originally anticipated. The first quarter of 2004 has demonstrated consistency and stability in market growth across all regions and major product lines.
The WSTS Committee has therefore based its industry forecast on a scenario of sound inventory levels and growing demand in major application sectors within the environment of a generally recovering world economy. Taking all this into account the year 2004 was predicted to grow 28.4% over 2003, which is a 9-percentage point improvement over the growth projections made last autumn.
For the following years, a deceleration in growth is forecast to 8.5% growth in 2005, followed by virtually zero growth in 2006. In 2007, another recovery cycle is expected to begin, with market growth in the 10% range. While the forecasted semiconductor market growth cycle is smoother than previous cycles, the different regions and products maintain their historical patterns. That is, the memory product cycle is more pronounced than the other products and Asia Pacific continues to be the fastest growing region, due not only to a continuing shift in equipment production but also to rising internal demand in those countries. The growth of equipment production in Mainland China will help sustain faster than average growth in Asia throughout the forecasting period.>>
The key here, apparently, is in the highlighted section about a "deceleration in growth is forecast to 8.5% growth in 2005" This has apparently "spooked" the semi sector as outlined in tomorrow's IBD as follows:
<<The Big Picture
Thursday, June 3, 2004
[snip]
<<Chip stocks weighed on the tech-heavy Nasdaq. The World Semiconductor Trade Statistics group thinks chip sales will start to slow in the second half of this year. Sales growth should decelerate to 8.5% in 2005, down from a projected 28% this year.
The Philadelphia semiconductor index, which has been under pressure since January, fell 2.3%. If chip stocks follow their normal cyclical pattern, they won't offer the Nasdaq consistent support for another six or seven months.>>
[snip]
So there it is, RtS and thread, we won't have to worry about the SOX doing anything great for another 6 or 7 months. I'm not sure what that is all about, but IBD has spoken - where the 6 or 7 months comes from I don't know - if anyone can decipher that cryptic remark please do so - I would be forever grateful.:)
Don |
