Looking like it is a sell the news scenario as the first of the chip equipment companies report.
As note there seems to be a modest rotation out of tech into value plays as the markets are near record highs on the major indices.
Two strategies depending on your cash position and outlook for the next 6 months. Either run tight stops knowing that profit taking will take you out or add to positions on the pull back. Historical in a pre-election year the fall and winter sessions are weak so I am running tight stop losses.
The other wild card is a lot of traders seem to think the Fed interest rate increases may be near an end. I expect higher for longer will be the Fed policy as they do not want to stop before inflation is broken. That normal means a recession, but given the amount of central bank engineering of the world economies the last decade or more it may be pushed out.
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Chip Gear Maker ASML Beats Second-Quarter Targets, Guides Higher
   
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PATRICK SEITZ09:47 AM ET 07/19/2023
Semiconductor equipment supplier ASML ( ASML) on Wednesday beat analyst estimates for the second quarter and with its guidance for the current period. But ASML stock fell on its cautious longer-term outlook.
The Dutch company earned the equivalent of $5.37 a share on sales of $7.52 billion in the June quarter. ASML reports financial results in euros.
Analysts polled by FactSet had expected ASML earnings of $5.10 a share on sales of $7.39 billion. In the year-earlier period, ASML earned $3.62 a share on sales of $5.55 billion, FactSet said.
For the current quarter, ASML forecast sales of $7.57 billion, based on the midpoint of its guidance. Analysts were looking for $7.14 billion in sales for the third quarter. In the same quarter last year, ASML posted sales of $5.66 billion.
Also, ASML predicted sales growth of 30% in 2023, vs. Wall Street's goal of 27%.
ASML Stock Is On Six IBD Lists In morning trades on the stock market today, ASML stock dropped 2.6% to 737.13.
The Netherlands-based company makes advanced lithography equipment for etching tiny circuits onto semiconductors.
"Our customers across different market segments are currently more cautious due to continued macroeconomic uncertainties, and therefore expect a later recovery of their markets," Chief Executive Peter Wennink said in a news release. "Also, the shape of the recovery slope is still unclear."
He added, "However, our strong backlog of around 38 billion euros ($42.6 billion) provides us with a good basis to navigate these short-term uncertainties."
ASML stock is on at least six IBD lists. They include the IBD 50, Leaderboard, Big Cap 20, Sector Leaders, Global Leaders and Tech Leaders.
ASML Is A Recent Breakout Wells Fargo analyst Joe Quatrochi said ASML's second-quarter report was positive but its commentary warned of a softening of demand in 2024. Still, he reiterated his overweight, or buy, rating on ASML stock with a price target of 775.
On July 13, ASML stock broke out of a flat base at a buy point of 747.13, according to IBD MarketSmith charts.
ASML is tied for first place in IBD's semiconductor equipment industry group, according to IBD Stock Checkup. It has a best-possible IBD Composite Rating of 99.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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