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Technology Stocks : Alliance Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: DJBEINO who wrote (7625)	5/30/2000 7:24:00 PM
From: Czechsinthemail	Read Replies (1) \| Respond to of 9582

Tuesday May 30, 1:25 pm Eastern Time Chipmakers' stocks rise on DRAM price increase CHICAGO, May 30 (Reuters) - The stock of U.S. chipmakers rose on Tuesday after analysts said demand for personal computers was pulling along prices for computer hardware such as processors and memory chips. Earlier, Lehman Brothers said in a research note it believed 2000 would be the best year of revenue and earnings per share growth for computer hardware companies since 1996. The firm cited resurgent corporate demand for computers and servers following a year-2000 spending slowdown and demand for higher capacity computers fuelled by large-memory software like Windows 2000 and rich Internet content. The Philadelphia Semiconductor index, which measures the stock performance of 16 leading names in the U.S. semiconductor and semiconductor production equipment industry, rose more than seven percent to a high of 973.97 before settling a bit to 971.98 in midday trade. Micron Technology Inc. (NYSE:MU - news) shares rose 3-7/16 to 68-7/16. Intel, which owns 20 percent of Micron and makes processors, rose 4-10/16 at 122-3/16. Processor maker Advanced Micro Devices Inc. (NYSE:AMD - news) rose 6-3/8 at 80-3/8 in midday trading. Lehman analyst Dan Niles said in the note the expected installation of Windows 2000 systems is prompting corporate information technology departments to buy faster processors and higher-capacity memory chips. ``We believe the average memory per box will increase from about 90 Mb (megabits) per system towards 128 Mb by the end of the year,'' he said. ``We believe that the DRAM (dynamic random access memory) industry is in its best shape since 1995 and that we will see a DRAM shortage by the end of the year.'' He started Micron, the No.1 U.S. DRAM maker with a buy rating. Niles said consumers were buying higher end computers that can handle richer media on the Internet as well. Donaldson, Lufkin and Jenrette analyst Boris Petersik also said in a research note today that he expects to see a strengthening for the balance of the year in the price of DRAM chips. Petersik said inventory levels at major chipmakers are currently at two weeks, down from four to five weeks in March, due to post-Y2K corporate PC demand. These lower inventory levels will allow the spot price of unbranded DRAM chips to rise above its recent $5 to $6 trading range by the end of the quarter, he said. Micron, in particular, may post an average 64Mb chip selling price of $7 in the quarter ending August and $8.50 in the quarter ending November from the current price of $6.50 for early June, he said. In late May, Micron's chip price was $6. Lehman's Niles also said Intel and Advanced Micro Devices will thrive from the favourable pricing for processors caused by a tight supply that is limiting system shipments in some cases.