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IMO, whether the AMD announcement is good news or bad news for intel depends on whether the problems are general lack of demand for processors or specific lack of either demand or yield for AMD K6 processors. I believe that it is the latter, thus this is good news for Intel, but this is only speculation. In the absence of guidance from INTC in the form of an earnings warning (either way, positive or negative), not only us but the entire market will be speculating. The market might well speculate, given the warnings from both Gateway and Hutchinson (HTCH) as well as AMD, that there is overall weakness when in fact it might be company specific in all three cases, and INTC might report at, slightly above or blow-out numbers. One possible scenario, therefore, is a big sell-off of INTC right up to the day of earnings announcement, then an absolute explosion if INTC beats their numbers. There are many other scenarios also, I am sure that all of you can figure out most of them. Just remember that given our dispositions, all of OUR expectations are likely to favor that these negative warnings are company specific, while the market, seeing negative warnings from not one but three unrelated companies (all making PC components) is much more likely to see this as a negative signal for the entire sector. It could make for a most interesting five weeks. |
