If you can believe what analysts appear to be saying, including the following information released yesterday, the tide may lift all boats - FSII and Cube included. In addition, 75% of the money managers (who have the power to move markets with their buying power) think small caps will outperform here in a Barron's survey. In any event, these articles tend to indicate things may be looking up, even with Asia:
COMLINE Daily News Electronics
November 12, 1997
September Semiconductor Sales Show Steady Sailing
The American Semiconductor Industry Association (SIA) reported on Nov. 6 that the world sales of semiconductors rose to 14.7% over September, 1996 to US$ 18 billion, the highest annual rise in 19 months and the fifth consecutive month showing a positive change. This was attributed to the healthy states of both the personal computer market and the communications equipment market, but also to stimulation of the semiconductor market by the development of new applications.
Figures for national markets indicated that the output of personal computers in Japan was no more than the usual level, but the three major markets outside Japan showed double-digit increases. In comparison to the sluggish demand last year, sales were up there by 20.1% to US$ 3.933 billion. The Asia-Pacific region excluding Japan was up 22.4% to US$2.677 billion. The SIA believes that world demand will continue to be dependable, growing by 5.5% to US$ 139.1 billion next year.
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Copyright 1997 The Financial Times Limited
Financial Times (London)
November 12, 1997, Wednesday EUROPE EDITION 1
Chip industry gears up to spend
By Paul Taylor
The world's semiconductor industry is gearing up for a substantial increase in capital spending over the next few years, figures released yesterday by Semiconductor Equipment & Materials International (Semi), the industry association, show.
Elizabeth Schumann, Semi's senior market analyst, told an industry audience in Munich yesterday that annual capital equipment spending would grow from about $ 28bn this year to about $ 45bn in the year 2000.
The strongest growth - 22 per cent - is expected between 1999 and 2000 as new manufacturing processes come on stream. Ms Schumann's forecasts, based on a survey of 90 Semi members, reflected the transition over the next few years to larger 300m silicon wafers and 0.18 micron chip designs.
Both steps will increase chip makers' output, but will involve hefty investment in new plant and equipment, including wafer processing machinery.
"We expect the 300mm fabs [semiconductor manufacturing facilities] to go in at the same time as the move from 0.25 micron to 0.18 micron designs," she said.
The industry expects to be boosted by a recovery in semiconductor sales with double digit growth rates each year, beginning with an 11 per cent gain in 1998 and reaching $ 232bn in 2000.
Ms Schumann acknowledged "mixed signals" about semiconductor making capacity, with some evidence of increasing capacity utilisation offset by continuing weakness in memory chip prices.
Despite this, she said 43 new fabs, with a capacity of nearly 800,000 8-inch wafers a month, would be added next year.
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I've got a few more articles of a similar nature at members.aol.com - maybe this is a buying opportunity - at least that is my call on the recent weakness.
Best - Joe |
