Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 230.37

+0.7%

11:23 AM EST

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To: Fortinwit who wrote (26159)	11/11/1998 8:30:00 PM
From: Justa Werkenstiff	Read Replies (2) of 70976

F: You are right to be skeptical about those forecasts. They are just noise. Now the media is throwing it on top of the INTC positive preannounce and it could be like putting the last drop of gasoline on a fire. It seems the big boys have been buying on the AEA anecdotal evidence of a turnaround. ASMLF, through Maris, said it was getting an uptick in business along what CYMI stated in their cc. But he was not too optimistic although that is the nature of Maris to begin with. Nice gains in both of those issues today. Now just because INTC is pulling in some bucks, does not necessarily mean they are going to go capex crazy in 1999. It seems to me they have been cutting costs and they continue to cut costs with a continuation of the layoffs to bring it all to the bottom line. I would think the reduction in capex has brought them some money to the bottom line as well. This is just a thought and is not a conclusion. Now for the analysts. Starting with the proposition that they owe us nothing and treat us in a manner consistent with that idea, I find it very interesting that they have been crowing that the sector is overvalued almost in unison. When have they ever done that before? I can't remember last. Anyone? All this seems to suggest that they did not have themselves positioned properly for the upleg and are trying to talk the stocks down and have been quite unsuccessful to date. I recall that when ASMLF made its first spike from the $13 area, some foreign firm came out and reiterated a strong sell. Gee, I wonder if they were short? Maybe the same thing was true with these other analyst firms covering this sector. So I suspect we have had a great deal of short covering in this rally. Either that or the analyst firms did not get enough bargained priced share to fit their needs. All this leads me to believe there is a great deal of support for this sector and while we may get pull-backs, it won't be significant unless the reality of some new and consistent orders does not hit in line with expectations. Of course, exogenous events (you pick it) or an absent Doctor Greenspan in combination with order delays notwithstanding. I continue to sell some margined long positions here and continue to increase short positions as a hedge to longs on market strength as the risk/ reward of being long decreases. I am trading for a pull-back while investing in the uptrend.

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