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To: Johnny Canuck who wrote (24466)	12/2/1999 3:27:00 AM
From: Johnny Canuck	Respond to of 69827

Semi-equipment demand To: Alan Hume (35476 ) From: Don Green Wednesday, Dec 1 1999 2:14PM ET Reply # of 35494 O.T. Chip Equipment Boom To Blast Off (12/01/99, 11:08 a.m. ET) Semiconductor Business News Semiconductor equipment suppliers are ending the year feeling upbeat about the prospect for strong growth in capital spending by chip makers after being beat up badly by last year's recession. A survey of suppliers shows respondents expecting worldwide equipment sales to grow 18.3 percent, to $27.7 billion in 2000 from $23.4 billion this year. "The year-end survey shows that our industry expects to begin the new century with a solid upturn," said Stanley Myers, president of the Semiconductor Equipment and Materials International (SEMI) trade group, which released the survey results at its Semicon Japan trade show on Wednesday. The Silicon Valley-based trade group polls its members for a consensus forecast twice a year. The year-end survey shows optimism nearly unchanged since last summer. The survey predicts semiconductor equipment revenue to grow 20.3 percent in 2001 and 14.3 percent in 2002. For wafer processing equipment, SEMI's year-end survey shows revenue growing 18.7 percent, to $17.9 billion in 2000 from $15.1 billion in 1999. Assembly and packaging equipment sales are expected to increase 12.4 percent, to $2.1 billion from $1.8 billion in1999, according to the survey. Test equipment revenue is expected to rise 18.6 percent, to $5.6 billion in 2000 from $4.7 billion in 1999. The SEMI consensus forecast is a little less bullish about next year's growth than other forecasts by market researchers. Dataquest, San Jose, Calif., predicts wafer fab equipment sales will surge 26 percent, to $19 billion, next year from $15.1 billion in 1999. In 2001, fab equipment sales are expected to jump 47 percent, to $27.9 billion, followed by a 19 percent increase, to $33.3 billion, in 2002, according to analyst Clark J. Fuhs, director of Dataquest's Semiconductor Manufacturing Analysis unit. But nearly everyone seems certain that 2000 will mark the beginning of the next growth cycle for capital spending after investments nearly dried up in 1998. Fab equipment spending fell 28 percent last year, to $14.6 billion in 1998, according to Dataquest. "Reports of new orders and shipments are already showing signs of renewed growth in the industry, and the prospects for accelerated growth in 2000 seem promising," Myers said. "With the continued expansion of Internet-related technologies and increasing demand for semiconductors in new electronics, semiconductor equipment and materials companies stand well-poised to benefit as chip manufacturers ramp up production." techweb.com

To: Johnny Canuck who wrote (24466)	12/2/1999 3:41:00 AM
From: Johnny Canuck	Respond to of 69827

Stock market commentary: To: IQBAL LATIF (29872 ) From: IQBAL LATIF Wednesday, Dec 1 1999 10:03AM ET Reply # of 29885 <<Wow, what a confused market! Let's start with the SP500. From 11/16 to 11/29, this index traded between 1400 and 1425. The top of that range is "new all time high" territory. The market was last up at these highs in late July when the SP500 hit 1420.14. Then on Tuesday, after two weeks in that range, the SP500 dropped out of the bottom of the range. This sets up the distinct possibility of a double top. A big picture double top here would have very negative implications. While the SP500 was testing its all time highs last week, the Dow was still 3.3% below its all time high at 11365. The Dow has spent most of the year swinging between 10400 and that high at 11365. With the exception of the drop below that range in late September and October, the Dow has been rangebound since mid April. Now onto the Nasdaq, everyone's favorite index (until Tuesday). The big news last week was that there was actually one day that the Nasdaq did NOT set an all time record (that was on Tuesday, 11/23). For those keeping count, the Nasdaq Composite had 17 record closes in 21 trading days. These types of runs do not last forever, and when they do end we usually see some carnage. Last Friday looked like the final record for this run, as the Nasdaq fell 3.22% on Monday and Tuesday. Now this does not necessarily mean the remarkable tech stock run is over, but just remember that blow off rallies usually end in a spectacular fashion. Meanwhile, the Dow Utilities have hit a new low for the year and are now down 9.9% for 1999. On Monday they hit their lowest level since early September, 1998. The Dow Transports are faring a bit better, but they are still down 7.7% for the year. So, with some very mixed performances by the stock market indexes, we turn our attention to the market internals. In short, they are just as mixed up as the stock indexes. The breadth indicators (which use the advancing and declining issues data) have been very weak. Even last week, when the SP500 was flirting with new all time highs and the Nasdaq was setting one record after another, these indicators kept dropping. In fact, they actually fell into oversold territory (pretty strange with the market right at all time highs!). Meanwhile, the indicators that use advancing and declining volume have held up better. And several of the indicators that combine the up and down volume with the breadth data are in overbought territory. Like we said, a mixed picture. There is one measure of the market internals that needs special attention. On Monday, the advance decline line hit its lowest level in over four years. The last time the advance decline line was at a lower level was on 6/29/95, when the SP500 was at 543.87. On Monday, the SP500 closed at 1411.18. This means that in the last 53 months, a period in which the SP500 has advanced 259%, the number of advancing stocks and declining stocks has been equal. There is only one explanation for this...the market is being driven by only a small handful of the biggest stocks. As we have pointed out in the past, the advance decline line is a pretty rough indicator. It doesn't figure very prominently in our intermediate term analysis. BUT, this huge divergence should be noted. In the past when we have had these types of long term divergences in the advance decline line, things have ended very badly for the stock market bulls. This indicator is not precise when it comes to timing, but it shouldn't be ignored. Finally, the interest rate picture has deteriorated in the last couple of weeks. Back on 11/16, the 30 year T-bond rate dipped briefly below the 6% rate. Since then it has moved steadily higher, and closed at 6.28% on Tuesday. Short term rates have also moved up...the 3 month T-bill rate has gone from 4.96% at the beginning of November up to 5.15% on Tuesday. Higher interest rates are not good for stocks, and if these rate trends continue, the stock market will start to take notice. So the market presents a very muddy picture here. But with the SP500 losing momentum in the area of prior highs, interest rates heading higher, generally weak internals, and the Nasdaq on thin ice, we would rather err on the side of caution. After treading water for the last few weeks, the market is poised for a big move. Add in the year end shenanigans and Y2K and things should start to get very interesting very soon. >>from walker letter