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To: SJS who wrote (32529)	9/21/1999 11:34:00 AM
From: Proud_Infidel	Respond to of 70976

Taiwan quake seen shaking world chip prices BY YOO CHOON-SIK SEOUL (Reuters) - The strong earthquake that hit Taiwan overnight was expected to push world chip prices higher, at least in the short-term, analysts in Seoul said Tuesday. They generally shrugged off statements by Taiwan's major chipmakers, Taiwan Semiconductor Manufacturing Co and United Microelectronics Corp, that the quake had caused electricity outages but no damage to their production lines. ''The exact damage there has not yet been disclosed but chip production lines are very sensitive to tremors and I think this will lead to another rise in chip prices,'' said Jon Chong-hwa, an analyst at Salomon Smith Barney KEB Securities. Jon said the world spot price for the current mainstay 64-megabit dynamic random access memory (DRAM) chips could rise above $15, the highest level seen so far this year. The earthquake, measuring 7.6 on the open-ended Richter scale, struck the island state before dawn Tuesday. The quake killed at least 402 people. ''The impact may not be as strong as that from the electricity blackout in late July, but certainly there will be movements in price,'' said Shim Yong-jae, an analyst at SG Securities. South Korean chipmakers, leaders in the world memory chip industry, saw their share prices soar at the open of trade Tuesday before settling down later as investors hesitated to join the buying spree. In mid-morning, Samsung Electronics Co was up 2.7 percent at 227,000 ($188.9), Hyundai Electronics Industries Co gained 3.7 percent to 36,500 and Hyundai Microelectronics Co rose 3.4 percent to 25,650. Brokers on the Korean stock market attributed the lack of strong follow-through buying in chipmaker shares to concerns about how much the shares had already gained this year. Samsung shares have risen 184.4 percent so far this year, while Hyundai Electronics was up 61.0 percent and Hyundai Microelectronics, previously LG Semicon, was up 85.1 percent. The overall Korean share market has jumped 66.0 percent so far in 1999. The three South Korean makers accounted for 35 percent of world DRAM sales in calendar 1998, with Samsung alone taking 18.8 percent of the world DRAM sales. Analysts said Taiwanese chipmakers, which account for about five percent in the world DRAM market, had a strong influence on the world spot market for the chips whereas South Korean makers depend heavily on volume contracts. When taking into account the outsourcing for Japanese and other makers, the world DRAM market share of Taiwanese companies stood at about 12 percent, analysts said. The world 64-megabit DRAM price was declining moderately these days after hitting the year's highest level of $15 and was trading at around $12 per unit, they said. The recent price upsurge, which analysts attributed to strong personal computer sales connected to free PC offers, had beat expectations. The price stood at about $4 in May-June, they said. ($1-1,202 won)

To: SJS who wrote (32529)	9/21/1999 5:35:00 PM
From: A. Edwards	Respond to of 70976

Some Disturbances From Taiwan Quake But Little Effect On Valuations Salomon Smith Barney Tuesday, September 21, 1999 --SUMMARY:----Semiconductor Equipment Major quake hits Taiwan (7.6 on Richter scale), knocking out power to island. Major foundries such as TSMC, UMC, and WSMC are located in Taiwan. Country represents 15-16% of semi capex and is a major region of growth. Emergency power available; main power should be restored around noon Tues. See 2-4 wk. disruption as fabs are requalified. Order perturbations may result over the next 1-2 quarters but upstream pricing is healthy. See little effect on equipment stocks valuations due to firm semi pricing. Use weakness as buying opportunity.