Zeev, what's your opinion on Semis in the near term? I am now almost totally into cash. Hats off to Mason, who several weeks ago indicated the time was right to bail on the sector. I disagreed, stayed, and got whacked pretty good (still up 75%, but still......). I'm very cautious right now, simply because
(1) the Fed could raise rates, although this scenario is unlikely.
The inflation numbers are very benign, and the foreign sectors in Latin America and Asia are still fairly precarious, although the market continues to worry about it, and seems to react with each announcement that there won't be a a rate hike as being that much more certain that there will be one next time.
(2) the Semi sector definitely seems out of favor right now, especially with the ongoing cascade of announcements of worse than expected PC sales, but most importantly
(3) i don't see how China can long forestall devaluing the Yuan, which is very likely to cause further contractions in Asian economies and another round of Asian flu. When that happens, the sector will probably get whacked again,although perhaps not as largely as in the Fall or 97 or September and October of last year.
(4) Also, there is the chance that a lot of investors will bail on the market in general before the end of the year out of Y2K fears, and it really doesn't matter whether the fears are groundless or not, if they exit the market their impact WILL be real.
All in all, I see more downside than upside right now, and have gone somewhat cautious. I would be delighted to hear from some of you.
Opinions Please!
jess |
